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48. Car sales continued out of “John’s Repair Shop” businesses that John set up as sole
proprietorships. As Jim and John were involved in selling cars, the vehicles were titled,
for sales and registration transfer purposes, through various individuals, relatives and
former Auto Pride employees as the cars were sold to individuals. Neither Jim nor John
had a state auto dealer license and the volume of cars they individually or collectively
sold would have normally required a state dealer license. By using “straw” sellers they
knowingly evaded state licensing requirements.
49. The evidence was unclear if John’s Repair Shop was a true sole proprietorship that John
ran, allowing Jim to also sell cars from that location, or if it was operated as some joint
business between John and Jim that was part of the Pride Auto businesses. No earnings
information, or tax filings of any sort for that business were provided.
50. The May 2008 Ruel / John’s Repair Shop lease for 689 South Barre Road in South Barre,
was solely between John (as John’s Repair Shop) and Richard Ruel and was in John’s
own name (Exhibit 9B). This is more consistent with John’s Repair Shop business being
John’s own sole proprietorship, as Jim claims, rather than part of a Pride Auto business
partnership.
51. The 5/3/07 Environmental Court order, from the Town of Brookfield proceedings to
require the Pride Auto cars be removed, was against Mr. Moorcroft alone as an individual
(Exhibit D). This is consistent with the Pride Auto businesses being a sole proprietorship.
However, the 2009 Pride Auto River Street, Montpelier lease termination proceedings
and judgment proceeded against John Severance personally (See Exhibit 24). No copy of
that operative lease was presented. The court cannot tell as to who and how it was
executed insofar as the named lessee. The admitted exhibits included a small claims
court action complaint NAPA Auto brought against Pride Auto, in small claims court,
wherein the Plaintiff described John Severance as the Pride Auto owner. (Exhibit 22). It
is unclear what statements or conduct served as the basis for the Plaintiff’s contentions.
52. The Pride Auto business entities in issue, according to Jim, filed Schedule C sole
proprietorship tax returns in Jim’s name, but none were produced at trial. To the extent
John claims the Pride Auto business(es) was (or were) a partnership (or partnerships) for
many years, he admits he never saw any tax returns or partnership Schedule K-1’s of any
kind indicating he (John) had an ownership interest in the businesses.
53. John appears to ask the court to infer he and Jim had a true business partnership by the
mere fact John provided services for the auto sales ventures, income from those ventures
was used from Jim and John’s shared household while they lived together as an intimate
domestic partnership, and he had made some initial payments (loans or investments) of
about $30,000. There was never any alleged express discussion between Jim and John
wherein they agreed to share the income and losses of the Pride Auto businesses.
54. The sharing and pooling of assets between Jim and John appears to have arisen from their
intimate domestic partnership. This “partnership” was one by which they shared income
and expenses of their household and lives during the time they sustained relations as
intimates or domestic “partners”. This is a different “partnership” than a business general
partnership. (See Legal Analysis below)