Yacht share agreement(s)

[pcatterall]

For our proposed yacht share we are considering that there should be 2 agreements.

One would be the primary agreement which would be a legally binding document on the lines of the RYA suggestions.
We think that there then should be a secondary agreement covering occupation dates and their selection, purchase of minor equipment, maintaining records, houskeeping rules and regs and so on. This document could be changed by agreement of a members quorum.

The idea is to keep the primary agreement as simple as possible but to have the secondary agreement so everybody understands the rules but to be able to change it to reflect new issues and as circumstances change.
Has anyone had sight of such a document which they can share ( somthing which would at least act a as a framework for us)

 

[KenMcCulloch]

Hi
We have an agreement based on the RYA template but with some additions. Our agreement requires us to have an annual meeting of the syndicate at which we agree the coming year's sailing programme, maintenance tasks, budget and so on. That does more or less what you describe in that the overall framework is an agreement which sets out basic obligations, what is to happen if someone wants to sell their share, or someone dies. The AGM sets out a time limited agreement about the kinds of details you describe and is renegotiated (or in some respects confirmed)each year. It's worked well for us.

 

[skyflyer]

The group I was a member of until recently had a primary agreement and then a "Schedule A" attached to it which had all the variables specified. Thus we could alter Schedule A relatively easily without a completely new agreement.

It is not based on the RYA model which I feel is to vague but has been created and honed over about 14 years of group ownership with various members joining leaving
and in two cases, rejoining again later.

The key thing I would suggest is that a share agreement ideally gets put in a drawer and is never looked at again, because if you are needing to refer to (and beat your co owner over the head with) the agreement all the time then its really not a very good group!

To that end we agreed many many variations and adaptations without ever needing to write them into stone.

I'd be happy to let you have a copy if it helps. I think one key principle we adopted was that issues relating to safety or maintaing the value of the investment were decided by vote, (i.e. if the majority agree then its done and everyone pays their share) whereas non-essential improvements and replacements were decided by veto - i.e. everyone had to agree or it didn't get done.

 

[Searush]

Don't let anyone buy a stonking great engine that fooks the boat up.

 

[rob2]

I like the idea of the veto system except that it should perhaps only cover the costs. That is, if all agree that something is desirable, but too pricey then the proposer may go ahead at his own expense but with no cost to the others or restrictions on the use of the improvement. That should allow some scope for anyone cash rich being able to spend as he likes if approved without prejudice to the remainder's enjoyment. What it comes down to is a bit of flexibility without allowing one person to fit a stonking great outboard!

I used to buy odd bits for my mate's boat if it was something I wanted and he was happy to have but didn't want to spend for it.

Rob.

 

[Niander]

Don't let anyone buy a stonking great engine that fooks the boat up.

Think that was a one off...

 

[ytd]

I have been involved with essentially the same group of friends for 40 years over 4 boats. We originally signed a standard partnership agreement but I have no idea where it is now. Members come and go as boats are sold or bought. With (currently) 7 members we rarely have a clash of usage, especially since we often sail together. When there is a clash we look back and the member who has used the boat less gets preference. All expenditure is split evenly except when the boat is on a cruise. Then cruise costs are split between members on the cruise. Democracy generally works and when members have not agreed with the majority they can sell their share to someone else of, in a pinch, the remaining members buy them out (at market valuation less prospective sale costs and discount).

 

[mihtjel]

I recently bought half a boat - in fact, a talked a friend of mine into buying a boat, and then bought half off him.

We're using a contract from the Danish sailing association, being in Denmark, which is quite clear on how things are handled in cases of disagreement, on how to sell the shares, and on how to handle the death of any of the participants. It has some practical rules, such as a yearly meeting in January, and includes specific provisions on who calls the meeting. But it mostly includes provisions for when things go wrong, and on how to end the coownership. It's not something we intend to refer back to often.

As we are only two people owning half of the boat, all changes to the contract, or work done to the boat has to be agreed upon by both parties. I for one would not want to participate in a shared ownership where a majority could overrule a minority on use of or changes to the boat.

 

[skyflyer]

I for one would not want to participate in a shared ownership where a majority could overrule a minority on use of or changes to the boat.

Just to clarify, our agreement only permitted this where it is considered a matter of safety or if lack of action will materially affect the value of the boat. If the three co-owners cannot agree on whether an issue qualifies under that rule, then there is provision for arbitration.

I believe one third ownership is much easier than half ownership precisely because there is a majority view and you don't ever get to a deadlock.

We never reached a point where we disagreed over what was a safety/material value issue, let alone needed to have arbitration invoked. 99% of the time it's bleeding' obvious to all concerned!

What is not acceptable is two of three people deciding a more powerful engine would be nice (as distinct from the old one having died) and forcing the third guy to pay his share!