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prior to their marriage. John titled the new car only in his
name. John told petitioner that he had mistakenly omitted
petitioner’s name from the car title, but John later acknowledged
that he had done so intentionally.
After petitioner married John, John’s spending began to
spiral out of control. John increased the amount and frequency
of charges he made on petitioner’s credit cards, and John became
increasingly delinquent in payments to petitioner to cover the
expenses so charged. At one point, John’s charges to
petitioner’s credit cards relating to John’s business reached a
total outstanding balance of $38,000.
With her own funds, petitioner eventually paid off a
significant portion of John’s charges to her credit cards.
On December 30, 1993, John incorporated his sales
representative business as MGI/McKnight Group, Inc. (MGI). An
election was filed with respondent to have MGI treated as an
S corporation.
At John’s insistence, petitioner signed the MGI articles of
incorporation, and petitioner, along with John, was listed on the
MGI articles of incorporation as a director of MGI. Petitioner,
however, was not aware of the legal significance of signing the
MGI articles of incorporation or of being listed as a director.
John always made it clear to petitioner that he regarded
himself as sole owner of the business and of MGI and that he did
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