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properties that were contributed to the partnership at its
formation included the three Orange County properties and the
University property that were already the subject of the BLA and
that were used to fund the amended trust. In addition, the other
three properties that were contributed were the Crescent Bay,
Railroad, and Manzanita properties in California that also
previously were used to fund the amended trust. After the
initial contributions were made, no additional property was
transferred to the partnership.
Decedent did not deed or transfer title to the seven LKHP
properties to the partnership. The partnership agreement
provided that title to any property that was contributed by a
limited partner, and was deemed to be owned by the partnership,
would remain in the name of the limited partner for the benefit
of the partnership. The leases that encumbered the LKHP
properties were not formally assigned to LKHP prior to decedent’s
death. The leases remained in the name of decedent, or in the
name of Sea Shell, after LKHP was formed. The title remained in
the name of decedent or Sea Shell in order to hide the change of
ownership from the general public and from the tenants of the
properties. Under the partnership agreement, Hillgren could
conduct partnership business without disclosing the existence of
the partnership. The partnership was designed generally to be
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