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decedent to form HFLP centered on what would happen to his
property after death. He wanted to protect what Lynn would
receive from him, not what she currently possessed.
Other facets of the entity’s establishment are similarly
consistent with a testamentary arrangement. In particular, the
largely unilateral nature of the formation, the extent and type
of the assets contributed thereto, and decedent’s personal
situation are indicative. Michael testified that decedent made
all decisions regarding the creation and structure of the
partnership. During cross-examination he stated: “We really
didn’t discuss anything. He told me what he wanted to do and he
explained why, and I accepted the assignment.” Later, when asked
why the guaranteed payment clause was added to the HFLP
Agreement, Michael replied: “The same reason every provision was
put in the agreement. * * * Specifically, because that’s what he
wanted.” Such statements are far more consistent with a
description of one man’s estate plan than with any sort of arm’s-
length transaction or joint enterprise between partners.
The fact that the contributed property constituted the
majority of decedent’s assets, including nearly all of his
investments, is also not at odds with what one would expect to be
the prime concern of an estate plan. We additionally take note
of decedent’s advanced age, serious health conditions, and
experience as an attorney.
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