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to be distributed.
In that same vein, upon receipt, the entire $1,050,000 was
deposited into JCC’s bank account that was established for the
sole purpose of receiving and, ultimately, distributing the
settlement proceeds. Of the $1,050,000 received from
Westinghouse, JCC paid $269,000 to The Johnson Corp. for
management fees earned in conjunction with West Mill and $492,442
to F. Gardner Parker, Trustee. JCC transferred the remaining
$286,737.27 to petitioner and recorded the transfer in its books
as a payable due from petitioner.4 Mr. Boswell, who had been
working closely with petitioner as treasurer of The Johnson Corp.
at the time of the settlement agreement, testified that JCC
considered the $1,050,000 received from Westinghouse to be income
to JCC. Likewise, JCC reported the $1,050,000 as income on its
1991 corporate income tax return.
Petitioner’s contention that his individual participation in
the settlement agreement is conclusive evidence of his rights to
a portion of the settlement is unfounded. The JCC corporations
entered into the settlement agreement to resolve claims
concerning the outstanding and defaulted debt owed to
Westinghouse. Petitioner was named as a party to the agreement
in his individual capacity because he was a guarantor of the
loan. The agreement identified and released petitioner as a
4 A nominal portion of the amount was used for
administrative expenses.
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