<html><body><span style="font-family:Verdana; color:#000000; font-size:12pt;"><div>Does the lease have common language defining the lessor (such as, A and B, and their heirs, successors, and assignees)? If so, the property and lease payments pass to the heirs upon death, though they'd be probate assets. Or was the intent to separate the right to receive lease payments from property ownership?</div><div><br></div><div>There are myriad ways to do this, but I'd think the parties intent as to which interests to pass to whom (the property and the lease payments) and tax implications are significant factors to consider. An inter vivos transfer, whether to a person or trust, can have gift or estate tax implications. If property and lease payments are to travel together, an inter vivos transfer to the sole heir, reserving a life estate to the property (which would include lease payments), would seem to effectuate a transfer of the property as a gift, at a value which could be discounted for the reserved life estate, and take it out of probate, albeit at the price of using some of the couple's lifetime gift exclusion. There also might be real estate excise tax due on the transfer. I think this can be accomplished with a Quitclaim Deed reserving the life estate.</div><div><br></div><div><a href="http://www.washingtonlawhelp.org/files/C9D2EA3F-0350-D9AF-ACAE-BF37E9BC9FFA/attachments/39297585-C160-3315-4545-295BD7475F68/6260en_quitclaim-deeds-and-life-estates.pdf">http://www.washingtonlawhelp.org/files/C9D2EA3F-0350-D9AF-ACAE-BF37E9BC9FFA/attachments/39297585-C160-3315-4545-295BD7475F68/6260en_quitclaim-deeds-and-life-estates.pdf</a><br></div><div><br></div><blockquote id="replyBlockquote" webmail="1" style="border-left: 2px solid blue; margin-left: 8px; padding-left: 8px; font-size:10pt; color:black; font-family:verdana;"> <div id="wmQuoteWrapper"> -------- Original Message --------<br> Subject: Re: [WSBARP] Assignment of Lease upon death<br> From: Richard Holland <<a target="_blank" href="mailto:rich@pnwle.com">rich@pnwle.com</a>><br> Date: Tue, August 02, 2016 10:14 am<br> To: WSBA Real Property Listserv <<a target="_blank" href="mailto:wsbarp@lists.wsbarppt.com">wsbarp@lists.wsbarppt.com</a>><br> <br> <style>
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</style> <div class="WordSection1"> <div class="MsoNormal" style="font-size:12pt;">I am sure there are 100 ways to do this but couldn’t they assign the lease to an LLC or Trust right now? (I don’t know about Trusts, I am honestly thinking more about an LLC). The LLC documents would then govern the transfer of the ownership interests and I should think there is a way to draft the Operating Agreement where those would pass outside of probate although wiser heads than mine might have more guidance in that regard.<o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;"><o:p> </o:p></div> <div> <div class="MsoNormal" style="font-size:12pt;">Thanks,<o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;"><o:p> </o:p></div> <div class="MsoNormal" style="font-size:12pt;">Rich Holland<o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;"><a target="_blank" href="mailto:rich@pnwle.com"><span style="color:#0563C1">rich@pnwle.com</span></a><o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;"><span style="font-size:10.0pt">733 7th Avenue, Suite 110<o:p></o:p></span></div> <div class="MsoNormal" style="font-size:12pt;"><span style="font-size:10.0pt">Kirkland, WA 98033<o:p></o:p></span></div> <div class="MsoNormal" style="font-size:12pt;"><span style="font-size:10.0pt">425-836-6240 / 425-748-3901 (fax)<o:p></o:p></span></div> <div class="MsoNormal" style="font-size:12pt;"><o:p> </o:p></div> <div class="MsoNormal" style="font-size:12pt;"><span style="font-size:9.0pt">The information contained in this communication, and in any attached document(s), is privileged and/or confidential, intended solely for the individual/entity to whom/which it was sent. If you are not the intended recipient, you are hereby notified that any dissemination, distribution, or copying of this information is strictly prohibited. If you have received this email in error, please notify me immediately at the email address, mailing address, or telephone or fax number above.<o:p></o:p></span></div> </div> <div class="MsoNormal" style="font-size:12pt;"><o:p> </o:p></div> <div> <div style="border:none;border-top:solid #E1E1E1 1.0pt;padding:3.0pt 0in 0in 0in"> <div class="MsoNormal" style="font-size:12pt;"><b>From:</b> <a target="_blank" href="mailto:wsbarp-bounces@lists.wsbarppt.com">wsbarp-bounces@lists.wsbarppt.com</a> [<a target="_blank" href="mailto:wsbarp-bounces@lists.wsbarppt.com">mailto:wsbarp-bounces@lists.wsbarppt.com</a>] <b>On Behalf Of </b>Margaret Delp<br> <b>Sent:</b> Monday, August 01, 2016 3:33 PM<br> <b>To:</b> <a target="_blank" href="mailto:WSBARP@lists.wsbarppt.com">WSBARP@lists.wsbarppt.com</a>; <a target="_blank" href="mailto:WSBAPT@lists.wsbarppt.com">WSBAPT@lists.wsbarppt.com</a><br> <b>Subject:</b> [WSBARP] Assignment of Lease upon death<o:p></o:p></div> </div> </div> <div class="MsoNormal" style="font-size:12pt;"><o:p> </o:p></div> <div class="MsoNormal" style="font-size:12pt;">Hello everyone:<o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;">I am working on an estate plan for a married couple. They are the lessors in a 30-year Tidelands Lease. In the event of their demise, they would like their only heir to receive the right to payments from lessee (shellfish company). The lease includes provisions reserving the right of the lessor to assign the agreement by giving advance written notice to lessee. <o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;"><o:p> </o:p></div> <div class="MsoNormal" style="font-size:12pt;">What is the best way to handle this? Can one assign a lease effective upon death?<o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;"><o:p> </o:p></div> <div class="MsoNormal" style="font-size:12pt;">I should also note that the couple hopes to have a very simple estate plan which also avoids probate. We are considering simple wills with a transfer on death deed for the property adjacent to the tidelands. <o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;"><o:p> </o:p></div> <div class="MsoNormal" style="font-size:12pt;">Thanks,<o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;">Margaret<o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;"><o:p> </o:p></div> <div class="MsoNormal" style="font-size:12pt;">--<o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;">Law Office of Margaret Delp<o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;">Mailing address:<o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;">PO Box 292<o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;">Langley, WA 98260<o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;">Physical Address:<o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;">2815 Howard Road, Second Floor<o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;">Langley, WA 98260<o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;">Telephone: 360-579-4530<o:p></o:p></div> <div class="MsoNormal" style="font-size:12pt;"><o:p> </o:p></div> </div> <hr>_______________________________________________<br> WSBARP mailing list<br> <a target="_blank" href="mailto:WSBARP@lists.wsbarppt.com">WSBARP@lists.wsbarppt.com</a><br> <a target="_blank" href="http://mailman.fsr.com/mailman/listinfo/wsbarp">http://mailman.fsr.com/mailman/listinfo/wsbarp</a> </div> </blockquote></span></body></html>