Share agreement for a trailer..any ideas what it needs to cover

deefor

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Three friends have just bought a trailer together, with quite different financial inputs, one has put up 50%, another 30%, the last 20%.
I am conscious that any issue with money is a good way to loose friends, and so we have agreed to have some sort of agreement on the trailer, adressing who pays what for maintenance, insurance etc as well as how any sale value in the future would be split.
Any ideas on what should be covered and should costs be a third each, rather than on the ownership share? Or even more difficult based on the amount of use each owner makes of it?
Any help gratefully received...or experiences of this situation
 

Mbronze

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I would probably make the agreement so that you all have a third equal share i.e in the maintenance and insurance of the trailer.
However, when and if you sell it the different financial inputs should be taken into account and the money received distributed 50, 30, 20.
Are the 3 friends likely to use the trailer equally? If so they may have to sort out which weekends each one can use it. Or plan all your shows for the season so everyone knows where they stand in who uses it when, because it will be inevitable that two of you or all three will want to use it for one specific weekend.
Hope this may help, somewhat ...
 

deefor

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I think there is a strong possibility that the 50% share will actually use the trailer most, which should be ok... But complicated by the fact that the 20% share can't tow at the mo.. but the 30% share has another trailer, so we now have situation of three people, with four horses, two trailers, two towing vehicles..we mostly do same sorts of things so will be going to same places so really hopefull will all work out ok..
Just not sure how to write up any sort of agreement...
 

Baileyhoss

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I have shared a trailer for the last 4 years successfully.

But it's a little more simple because it's 50/50,

Basically all costs are split 50/50. My sharer's oh does a lot of the maintenance so any parts are split 50/50 and if her oh does the work, i'll get him beer or something. i try and do my fair share of maint, pressure washing it every so often/keeping an eye on tyre pressures etc, so if it's an easy job needs done. I'll do it instead of leaving everything to him. WD40 catches, replaced ramp hook, etc.

insurance is split 50/50. i add that onto my horse policy & she gives me the money.

If it gets accidentally damaged by one of us or our horses, and it's not an insurance job, then who ever broke it gets it fixed. If it's an insurance job, then the excess would be paid by who broke it.

The costs are not in any way affected by who has used it the most - it's there to be used and it's up to you whether you use it or not - you don't get off paying, just coz you haven't used it. Just like if you owned it yourself, you would stll need to maintain it whether you used it or not.

If I were you I would keep the maint' costs people pay the same as the 50-30-20 rather than in thirds. That way, no one can say they have paid more towards maint than they should have or expect more if the trailer is to be sold.

Where you might struggle in a 3 way share is deciding who gets it and when.

The easiest thing to do would be to gather all your show schedules and decide what you will each want to go to and see if there are any big clashes. Where there are clashes, obviously the ownership share would get priority, but there is hardly any difference between the other 2, so they could either take turns or draw straws. We are lucky as there are a few people competing at our yard, so normally if one wants to go somewhere, there is usually someone else going somewhere else we can hitch a ride with. if not it'll be a case of taking it in turns with the bigger events we have planned at the start of the year taking priority.

If one person decides they want out, then the trailer is valued per the current market and their share is sold, either to the remaining sharers if they want it, or anyone else could buy in with the agreement of all parties. If an agreement can't be met on that, then the whole trailer will be put up for sale, everyone gets the proportion of the sale money back.

For example. My sharer wanted to upgrade. So I had the choice to:
Buy her out and keep our trailer myself.
Sell our trailer and use the money towards buying in a half share of the new trailer.
Sell our trailer and see if I could buy a cheaper trailer with my share of the money
She could try and sell her share onto someone at the yard, but only if I was happy with who it was.

Either way, she gets her money out & i have a range of options to choose from.


Hope this is of some help.
 

ihatework

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Ok, on the assumption that the 50% person sounds like they will use it the most I would personally say something along the following lines:

Insurance split equally 3 ways
Annual Maintenance split 50:30:20 if this is going to be roughly according to how much use the people will have, if not split equally 3 ways.
Any ad hoc damage to be paid by the person responsible for trailer at time of damage.
Trailer resale split 50:30:20

I share a trailer and we don't have any formal agreement as to who has what days, we try to be flexible. However we do clash at times so you will need to think how to handle this especially with 3 people
 

hollyandivy123

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i use to share my lorry, it didn't work out due to the other person who only has a 30% share expecting to use as and when she needed it and if she wanted then i couldn't use it
(this was after she had booked it 4 weekends in a row)

it got to a point that even if i booked it then if she wanted it then she took it, i even came up to the yard as she was driving out and it was tough her instructpr was waiting for her

she would book dates and not use it or tell me the wrong date and when i quizz why she wasn't using it i would get told that "you may use it if you wish today"

i also have strong views on drink driving which is you don't, but got told "you are being ridiculus as the lorry doesn't go that fast and your point of view is irrelavent"

this is from someone i thought was a friend..........................

so please work out the usage time and i hope it works out
 

deefor

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ohhh...different views from BaileyHoss and Ben n jerrys on how to spilt the "running costs"... so now confused... although fully agree on the damage issue. I take HHO above's point that sharing can be difficult, but hopeful, and maybe that will actully mean I should incude some sort of "break clause" where by any one can say they want out and we have to sort it..
 

Baileyhoss

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def need a break clause - what if someone loses their job, or loses their horse.

The reason I would split the maint costs per the 50 30 20 is because strictly speaking the 30/20 sharers will be entitled to use the trailer less and also they will get less return on the sale of the trailer. I would consider asking them to make their share 25/25 to give them equal rights second to the 50% sharer.

If they go thirds on all maint and you have it for a long period of time, the amount they will have paid in maint against depreciation, would practically make them full sharers and it could be seen as unfair that the 50% owner has first say on using the trailer that you all equally maintain.
 
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