Legal Question in Civil Litigation in California

Defining percentage ownership of a boat

I am buying a fairly expensive boat (about $140,000). I need to have our son on the registration as a part owner (for reasons of slip transferability). The other owner will be the family trust that my wife & I have (&, by the way, my son & 2 daughters are beneficiaries of the trust and all are over 25 years old).

I want my son to have only 1% ownership of the boat. Two reasons:

1)so he doesn't have to pay gift tax

2) so that if he were ever to be sued (heaven forbid) the plaintiff would not see him as a major owner of an expensive boat, and seek to extract that from him.

If I just register the boat with the DMV in California, there is no way to specify how much ownership he has, vs. how much the trust has. How do I declare this ownership percentage in a legal and visable way? Should I specify the percent ownership in a document, and have it ''recorded'' at the county offices (like a house sale, or mortgage), or what else should I do?


Asked on 9/13/06, 8:53 pm

1 Answer from Attorneys
Terry A. Nelson Nelson & Lawless

Re: Defining percentage ownership of a boat

'You can't get there from here', at least with the DMV. What you want to acheive might be done through trust ownership of the boat, or maybe by a oint purchaser agreement between the parties. However, if his name is on DMV title, he is going to be liable in a suit, to some degree. Your documents might limit his exposure, with a lot of time and effort.

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Answered on 9/26/06, 7:57 pm


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