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The lease contains no requirement that Hiwassee reseed or
reforest the leased land at the expiration of the lease.
The Shepherd Clifford Trust
On or about December 22, 1980, petitioner and his wife
established the J. C. Shepherd “Clifford” Trust Agreement (the
trust), an inter vivos trust with a term of 10 years. Upon
creation of the trust, petitioner and his wife conveyed an
undivided 25-percent interest in the leased land to the trust.
On January 5, 1981, they conveyed a second 25-percent undivided
interest in the leased land to the trust.5
John and William were equal income beneficiaries of the
trust. During the term of the trust, they each received one-half
of the income from one-half of the Hiwassee lease (i.e., each
received 25-percent of the Hiwassee lease income).
On or about April 1, 1991, the trust terminated. The
trustee reconveyed the two previously transferred 25-percent
undivided interests in the leased land to petitioner and his
wife.
5 The deeds conveying the two 25-percent interests in the
land show that the land was conveyed by petitioner and his wife.
Petitioner’s wife, however, owned no record title or interest in
the property. Her only interests were spousal rights and
benefits created under Alabama State law. The parties have
stipulated that in Alabama real estate transactions, it is
customary for the owner’s spouse to sign all documents to
eliminate questions regarding retention of dower or other spousal
benefits or rights.
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Last modified: May 25, 2011