Boat Partnerships

[JackC]

Short story- I posted a week or so ago about CCs. Tonight one of my fishing buddies approached me about going partners on a Sport Cabin. While I'm a bit reluctant to do this it does have its merits (we get along very well).

So - does anyone have a partnership type of arrangement. Do you have a formal contract? How did you work the details out? This won't happen until the 2009 season. What gets even more amusing is my current CC (not a parker) would be purchased by another fishing buddy as part of his concept.

If I went this route I was thinking the 23 but a 25 could be part of the concept. Comments on the 23 versus the 25 are appreciated.

Boat would be primarily inshore fishing, no need for twin engines.

Thanks - Jack

 

[Themis]

Partnerring in a boat is a very personal decision. I know of two partnerships from the forums I frequent. One of them is right here on CP, and I hope they will chime in, as they seem to have done it successfully. The other is a partnership I read about on The Hull Truth 2 years ago. Both California men were best of friends, and partnerred in a custom built aluminum boat. It did not end well, and the carnage was available for viewing on the internet by thousands. A 3 month old expensive vessel was for sale at a large loss to boot.

That post cemented that I personally would never partner (my brother in law had asked me if I wanted to do so with him).

 

[channel_surfer]

I partnered with my father on our new 2520. NEver thought twice about it, but it's my dad. Partnering with a friend or even another relative would be a big decision. I know we got a lot more boat then we could have alone. We both had boats, him a 20' aquasport and me a 23' wellcraft walkaround, we put the money from the trade in / sale of our old boats into the new boat which helped a lot.

 

[OT]

From our 1st boat to our current 5th boat, my brother and I have always been partners in each boat. With my brother, I never mind that he takes other people out when I can't go and vice versa. Since he is family, I don't mind it at all. Sometimes, he buys little things for the boat without asking me for my "half" and I do the same...again since we are family. However, I don't think I can or would do this with anyone but my brother. Like ParkerSal said it is a personal choice.

OT

 

[Capt. Ronnie]

I have ONE partner in life, My Wife !
I would NEVER go partners with anyone on a purchase like a boat !

 

[fly_fool]

I've had 2 boat partners in 10 years. The first lasted 3 years until my buddy needed our whaler everyday for commuting. I bought him out for a fair price. Last fall, I bought an 1800 with another fishing buddy. Sold the whaler and am into a bigger boat for little extra money. Here in Maine, we have such a short season that it is easier to justify the cost/hr when you can cut it in half. Besides, I spend about 1/2 of my boat time with this guy anyway, so why not have him pay for it!

 

[dave-j]

I owned three 40 ft +/- racing sailboats with one partner and my first power boat (22' Sisu) with another guy.

Both worked out really well. The key is sharing a vision on usage, maintanance levels, investment, etc. The biggest advantage I found was not the money part, but in having a built-in work partner to commission, de-commission, fix stuff ,or pull boat before a big storm.

One key to ending partnerships is to have a written agreement. Ours included a buy-out feature where one party sets a price and the other has the choice of either buying the boat for that price or selling the boat at that price to the partner that named the price. That keeps arguing about price at the end to a minimum.

Partnerships work well when:
1. Both partners are going to use the boat together for the majority of the time (like my racing boat partnership)
2. The partners anticipate NOT being able to use the boat too frequently and the planned usages don't overlap (like my first powerboat partner)
3. When time or expertise to maintain a boat alone is missing.
4. When you would rather have a bigger boat than you could afford alone and are willing to trade off flexibility and pride of sole ownership

In short, I like partnerships for the right circumstances.

 

[striperon]

As in all partnerships, you should memorialize your agreements in writing. It doesn't need to be that complicated, you can write it in the form of an outline and both sign it.

Begin with the idea that every partnership will break up someday. You want a way to buy one another's interest out in a businesslike manner, with either of you being the buyer or the seller.

A boat survey/appraisal by a disinterested party should be the base to start from. If either is dissatisfied with one survey/appraisal, allow the opportunity for either party to have another done, and if both are dissatisfactory, a third. Specify who pays for which one. (Suggestion: partner 1 pays for the first because he wants to buy, partner 2 is dissatisfied and pays for the second. both share the cost of the third.) Somewhere there has to be agreement, no matter how unrealistic one party may be about the value. If no agreement can be made, a public auction at which either or both can bid is a possible solution, then the unrealistic partner can bid up the price if he wants to.

You want to write down your agreement on when each will use it, what condition it will be left after each trip, expense sharing, when and how upgrades will be purchased, schedules for winterizing and spring launching, how maintenance decisions will be made and paid for.

Don't allow either person to loan the boat to family and friends, sure way to disaster. But make it flexible enough so, if both agree, there can be some relaxation of this. And one agreement to do this does not mean it applies again. Each decision is separate.

Amenity upgrades need careful agreement. One partner may be able to afford his share, but the other partner cannot, due to other expenses. One way to deal with this is for each partner to contribute a small amount on a regular basis in a joint savings partnership account needing both signatures to withdraw.

There may not be agreement on the choice of amenity to buy with the "Upgrade Fund." Designate an impartial, knowledgeable boat professional you both trust who can break the tie.

Part of my work is consulting and valuing assets (not boats) for companies and partnerships that are dissolving. A good written understanding at the beginning will do away with lots of assumptions by one partner or the other, assumptions that things will be done a certain way.

You might be surprised how you both will become energized to think of things to put in the agreement, and, in the end, be happier with your relationship because you each understand. Doing away with assumptions is the best part of this, you will both be happier.