Opinion ID: 545523
Heading Depth: 3
Heading Rank: 3

Heading: The House on Strathcona Drive

Text: 43 Walton's final challenge to his personal net worth calculation is that it includes $35,000, representing the purchase price of a house on Strathcona Drive in Detroit. Walton argues that BIRA had legal title to the property and that it was therefore improper for the Commissioner to consider the price of the house in Walton's personal net worth calculation. The government contends that the legal ownership of the house is irrelevant. It maintains that the dispositive fact is that the property was purchased and maintained solely for Walton's personal use. Walton responds that the property was purchased by BIRA purely as an investment, and that he personally never lived there. 44 The government's evidence is overwhelming. At trial, the defendant admitted that the house was furnished as a residence and that much of his personal and business correspondence was delivered there. Although Walton denied actually living at the Strathcona residence, he testified that he had slept there on occasion, had met acquaintances at the house, and had cooked some of his meals there. The defendant claims that these actions can be explained by the fact that he wanted to give the house a lived in appearance in order to prevent vandalism. The district court was understandably impatient with this explanation. 45 The defendant listed the house as his personal residence on the Academy's 1979 annual report to the State of Michigan, on his application for a State of Michigan driver's license, and on a promissory note given to a lending institution in exchange for financing on a boat. A female companion of Walton's recorded the property as her home address on the registration of her own automobile. Walton explained that the woman had never lived there, but that he had given her the car as a gift and that the Strathcona address had been used because the woman's daughter was the housekeeper there. Walton never explained why BIRA required a housekeeper to maintain a piece of property that was not being used as a residence. 46 BIRA's purported business purpose in purchasing the house as an investment is belied by the fact that the property was never rented out. 7 Based on this record, the district court found that: 47 The Strathcona property is a classic example of an asset that served no legitimate purpose whatsoever for the Academy.... 48 ... Walton was using the Strathcona house as his personal residence.... The Court finds incredulous defendant's expectation that the Court would believe that Walton did not live there even though he directed his mail to that address, and never received any rental income from it. 49 Our review of the record convinces us that the district court's finding with respect to the Strathcona property was fully supported by the great weight of the evidence. Having disposed of Walton's complaints with regard to the assessments levied against him personally, we proceed to a consideration of BIRA's tax liability. 50