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was started in Bradford, Vermont. Eventually it replaced Pride Auto Sales, as over time
the Pride Auto East business and location was viable, but the Pride Auto Sales was not.
41. During the domestic partnership and shared household years, income earned, from Jim
and John’s business and other income producing activities, was pooled for the combined
living expenses. Jointly pooled and used funds included the Pride Auto Sales income,
John’s World paper route income, John’s trailer rental income, John’s social security
benefits, and presumably any funds Jim got from his parents not immediately spent on
the auto sale businesses. It is hard to know what came from who or where or what sums
from what sources were used for what. No meaningful financial records of any of this
was produced, just fragments and snippets.
42. To make matters more complicated, as of 3/21/06 John became subject to a $107,480
federal tax lien (Exhibit 25). It appears John also by this time was not supposed to be
earning income to be eligible for his social security benefits he was receiving. The IRS
would be on the hunt for John’s World newspaper route earnings, and any pay for work
he did helping in the auto sales. John’s income sources were commingled into Jim’s
and/or Pride Auto bank accounts. The court finds a significant motivating factor for John
to do this was to defraud or deter IRS collection efforts, and/or conceal his income that
might affect his SSI benefits. While the domestic “partnership” relationship was in
effect, Jim knowingly helped John shield such assets.
43. John introduced one document by which he tracks about $30,000 in payments for things
he made on behalf of Pride Auto Sales (and/or Pride Auto East) – Tr. Ex N. The
document is not self explanatory as to whether these expenditures (assuming they were
made, for those business(es), which the court credits) were intended as loans or equity
capital contributions when made.
44. John testified “at first” as he made $30,000 in payments he believed it was as a loan, but
he came to consider it an investment. He does not describe any express discussion or
agreement between he and Jim to that effect. Jim denies anything like that occurred.
45. John clearly for a time acted as the lead sales guy or operations manager for the Pride
Auto dealership and became known as the “face” of the business. He also was given
signatory power on the company’s bank accounts. This does not necessarily mean John
was also a business owner. John claims he never got compensated, but Jim says John
received several payments for autos “off the books” as cash, and tacitly kept those funds
(with Jim’s knowledge) as payment for John’s services.
46. Moreover, John and Jim had their domestic relationship at that time, by which they were
commingling their financial assets across all fronts while they lived together. As part of
this arrangement they often deposited checks or sums for each other in one or more Pride
Auto, or other personal, bank accounts. Their personal accounts became commingled
with the Pride Auto business accounts.
47. Jim and John worked together to help Jim evade loss of his state auto sale dealership
license rights. Pride Auto was operated in a series of locations, and then lost its licensed
auto dealer seller status from the State of Vermont. Vermont has licensing requirements,
to lawfully sell vehicles as a car dealer. Pride Auto was not able to maintain those
requirements.