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On November 13, 1976, Dr. Farah was appointed to the medical
staff of Washington County Hospital in Hagerstown, Maryland. In
May 1977, petitioners purchased a large, historic house located
at 1003 The Terrace, Hagerstown, Maryland (Hagerstown house). At
the time of trial in this case, petitioners still owned the
Hagerstown house. Dr. Farah has always maintained an office in
the Hagerstown house. Since 1980, he has used the Hagerstown
address as the business address for his medical practice and
myriad other business activities.
In addition to their work in the medical practice, since
1992, petitioners have been general partners in the Boonsboro
Medical Center Partnership (Boonsboro Partnership), which owns
and leases office space to various tenants including physicians.
Dr. and Ms. Farah own a 71.74-percent and 1.74-percent interest
in the Boonsboro Partnership, respectively.
The Purchase of the Berlin House and the South Point Road Lot
On October 18, 1989, petitioners purchased a piece of
waterfront property consisting of 3.27 acres and a house located
at 5922 South Point Road, Berlin, Maryland (Berlin house).
Petitioners intended to use it as a summer home and eventually
make it their retirement home.
The property was originally listed for sale for $399,000.
However, the sellers accepted petitioners’ offer of significantly
less, either $315,000 as respondent contends or $365,000 as
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