[WSBARP] Keep probate open for how long?

[Eric Nelsen]

I think the simplest solution is probably to let the liquidation happen in 3-4 years when the other owners retire. To do that from the probate perspective, here’s my thought:


  1.  Binding agreement between PR and LLC that (a) the LLC shall be dissolved no later than X date and thereafter promptly and diligently wound up and liquidated pursuant to Washington law; and (b) the LLC will accept the heirs as members upon distribution of decedent’s LLC interest to them. Might want to add more provisions to make sure remaining owners don’t make big loans to themselves or needlessly encumber/impair value of the LLC in the meantime—might not be needed depending on the circumstances. Retain a lawyer who handles business/corporation law if it starts to feel too tangled.



  1.  PR distributes LLC interests to heirs by assignment. Then the heirs can follow up directly with the LLC owners after that, and the estate can be closed.

Sincerely,

Eric

Eric C. Nelsen
Sayre Law Offices, PLLC
1417 31st Ave South
Seattle WA 98144-3909
206-625-0092
eric at sayrelawoffices.com<mailto:eric at sayrelawoffices.com>

From: wsbarp-bounces at lists.wsbarppt.com <wsbarp-bounces at lists.wsbarppt.com> On Behalf Of Neli Espe, J.D. - Olympic Legal
Sent: Friday, January 17, 2025 9:32 AM
To: WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com>
Subject: [WSBARP] Keep probate open for how long?

Dear Listmates,

Decedent, together with a couple of partners, started a business and bought a building in which the business was located. They formed two LLCs, one for business, one for building, decedent a third owner in each. Business is still functioning and cannot be moved to a different location (location, nature of business and expensive  building improvements already made). Decedent’s share of Business LLC already paid to estate.

Value is in the building, not in the business. Operating agreement of Building LLC allows for share to be offered to the living members first, then to general public (obviously, for the second there is no realistic market). They do not have the money to buy out the deceased partner’s share and did not get life insurance. They state that refinancing of current mortgage would be ‘detrimental’. They further state that they plan to retire in 3-4 years and would sell the building and business at that point. Payout to estate, in their minds, would be at that point.

Decedent’s heirs (siblings) live out of state and would rather avoid any court clashes to force the hand of the living Building LLC members.

They are ready to wait.

I am not.

But, I have a hard time formulating a winning strategy. Any help would be appreciated.

Kind regards, Neli
___________________________________
   Neli Espe, J.D., Olympic Legal
                360.630.3635
2114 Commercial Ave., Anacortes
            olympiclegal.com<http://olympiclegal.com/>
      Estate Planning | Probate
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