Shared Ownership?

[Rob Stokes, N. Vancouver]

I'm looking into shared ownership of a boat - still in the early stages of investigation. I'm curious if there's such a thing as a "template" agreement that anyone's used for this - something that covers off costs/maintenance etc.?

[Rich VanValkenburg]

Oh boy. What I could say. There are some here that very willingly would be part of a syndicate just to keep a boat, or class of boats alive. I have nothing but respect for one that comes to mind, and I know he'll answer this thread. But my experience has been less than tasty. I was twice part of a partnership, but the situation here in Michigan stipulated that a boat be registered in one person's name. And after all the work was finished, guess who took off with the boat? After all, it was registered in his name. I know of no template that would keep all parties absolutely honest. A partnership means that someone wants a boat but doesn't have enough money, so why not use someone else's money? I look at it this way now, a boat is like a wife. They can both be high maintenance and expensive. But would I want to partner off a share in my wife? Not hardly likely.

[David G]

I am part of a 4-party joint ownership. It's worked mostly very well for 5 + years. We keep strict track of all expenses and contributions - including all labor hours (at a pre-determined hourly rate). I never would have done this on my own, but am glad to have the info. We are equal owners, and will use the tally only to disburse the proceeds if we should happen to sell the boat. We postulated an exact method of allocating usage - but in practice we just coordinate by phone. The boat doesn't get used so often that it's been an issue. And frequently the usage is by multiple members of the partnership together.

It should be noted that one partner is my best friend, and two others are my sons. Our deal had less to do with getting a bigger boat than any could afford alone, and more to do with the experience of building and owning a boat together.

So far, so good. No fisticuffs yet. No sabotage, gun-play, or legal action (and believe me, any of my 3 compadres are capable of it).

My advice is twofold: choose a partner that know without a doubt that you cant trust and get along with; write the partnership agreement as if your partner was the most contrary demon on earth - leaving nothing to interpretation and no assumption undocumented. If you get it all clear upfront, and have an enforcable contract, AND you like the person anyway... I think you should be ok.

[rbgarr]

From the WB search engine:
Mayher, Bill, author: "Boat Partnerships 101," WB issue 183, p. 46

[George Roberts]

"the situation here in Michigan stipulated that a boat be registered in one person's name."

It is almost free (well under $100) to form an LLC and put the LLC's name on the registration. Of course, the LLC provides protection of the partners against the acts of the other partners.

No one wants to co-own a boat without some type of corporate protection.

[Woxbox]

I've got a quarter ownership of a boat. After 4 years, it's worked out great. Biggest bonus, between the four of us, we were able to take the boat down to the Bahamas and back this past winter. Couldn't have pulled that off alone.

We formed an LLC in the state of Delaware. The corporation owns the boat, we pay monthly dues. All bills are paid by the partnership.

That WoodenBoat reference above is a good place to start. Send me a PM with your personal email if you want to see our agreement. There are actually two documents -- one creates the legal corporation. The second is an operating agreement.

The biggest value of the paperwork is that it forces all parties to sit down at the outset and discuss all the possible events that might come up, and how they will be handled. We spent hours on this, and it was well worth it. No arguments or misunderstandings yet.

In practice, we each get the boat one week each month. Working full time, that's all I'd use it if I owned it outright. So I'm a fan of the idea. But yes, you do have to pick your partners carefully.

[Bob Cleek]

Shared ownership in a boat is sort of like sharing a wife. I suppose it's worked for some, but I can't see me doing it. On the other hand, imagine all the money you'd save! (Sharing a wife, I mean, not sharing a boat.)

[bamamick]

I'd do it in a heartbeat if the right situation came along and my circumstances allowed it. We have talked for a couple of years about a syndicate to buy and restore a 30 square metre either in Port Huron or Seattle, and I would like to be a part of that.

A Swedish 6mR syndicate has 10 members. All ten put up $10K US to buy a boat and rig it. After the initial investment they pay $1500 per year for maintenance, insurance, storage, etc. They divide the labor and sailing positions by talking about it as a group, and as far as I know it has been working. The reason they decided on a ten-person syndicate is that it takes five to race the boat and they figured it would be a rare occasion that they would get more than five folks together at one time. If there are more than five that want to go on any given day they have access to crew spots on other boats by some prior arrangement.

I know that this all sounds very Utopian and in all likelyhood a lot more idyllic than it actually is, but it DOES sound good to me. Imagine sailing one of the finest class boats in the world in some of the most amazing venues? Most of us can't and never will be able to afford such things, but if you could find a group of kindred spirits think of what you could experience? I am not one of those people who HAS to drive. I can have as much fun trimming a main or turning a winch as I can driving. For me it has just been a matter of wanting to sail certain boats, and for me to do that it took me spending my own money. In the end every boat I have ever owned with the exception of one Star has been way behind the curve. Imagine if you had the help you needed to do it and do it right?

I'd do it. When things allow for it I will do it.

Mickey Lake

[paladin]

I have had one good experience and two bad ones. In Thailand my boat was too big for an evening sail. Retired Colonel Walt couldn't justify a boat no more than he sailed. We bought one together, coordinating it's use. I did most of the upkeep/maintenance. Walt sailed but notified me if he was taking excessive time...I usually told him to go sailin when he wanted..the first one to Leave Thailand willed his half to the other party.
Number two I owned the boat...but had a young man that wanted to learn to sail...I traded sail time for work on the boat. It worked out well until he obtained a bunch of friends that took advantage and took the boat without permission...and left it in a really bad state after a weekend part...plus getting into my personal booze locker and cleaning it out....
Third time was similar to #2..after that I decided not to have "partners".

[Concordia...41]

There are several Concordias with "shared ownership" arrangements.

[Rob Stokes, N. Vancouver]

Thanks to all for taking the time to respond - this has been extremely helpful and I'm going to pursue this further, at least to the point where I have a decision to make.

Does anyone have any examples of contracts for shared ownership?

[Dan McCosh]

Tried it a long time ago, when I was relatively newly married, with a friend who was single. Main issue became his habit of bringing along lady "crew" who liked to sail, but felt excessive clothing was a hinderance. Didn't bother me, but my wife had concerns. I was advised to end the partnership.

[Bobcat]

Sounds like the biggest issue is finding someone who is compatible in terms of boat maintenance and cleaning. If you generally agree on such things and are both responsible, the language of the agreement is probably secondary.

[Dr.Spoke]

I had a Folkboat with a friend, in fact a very good friend and we still are, but I felt that I was putting in more hours... Sometimes more money... So I bought another boat. The folkboat rotted and was sold - so I guess I was doing the lions-share.
My current boat needs no partner - I can easily single-hand in my waters, and it costs less than 1000 USD a year to "own" it.