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of November 14 and December 10, 2003, warned petitioner of the
potential for default and gave him an additional opportunity to
pay his taxes without defaulting on the OIC. Petitioner again
failed to pay his 2002 tax liability.
Under the circumstances, petitioner’s failure to satisfy his
2002 tax liability amounted to a “material breach” of the OIC.
By withholding a sizable sum of money from respondent for a
substantial period, petitioner deprived respondent of a material
financial benefit under the OIC. Also, at the time respondent
declared petitioner in default on February 11, 2004, it appeared
unlikely that petitioner would cure his failure. By that time,
petitioner had failed to comply with the terms not only of the
OIC but also of respondent’s letter of December 10, 2003 (again
requesting payment of petitioner’s 2002 taxes), thereby declining
an opportunity to “cure” his failure.
By failing to satisfy his 2002 tax liability for over a
year, petitioner committed a material breach of the terms of the
OIC. Nor is there any applicable “excuse of a condition”. As
explained supra, an express condition of a contract may be
excused if a contracting party can show that (1) compliance with
the condition would result in a disproportionate forfeiture or
penalty, and (2) the condition was not a material part of the
bargain. See 2 Restatement, supra sec. 229. The record before
us does not indicate that strict compliance would have resulted
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