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to the lender because it might have caused the refinancing to
fail.
There were no recorded minutes of any meetings of partners
of LKHP. On May 13, 1999, after decedent’s death, a certificate
of limited partnership was filed for LKHP with the California
Secretary of State.
3. LKHP Distributions
The partnership agreement provided for distributions of cash
at the sole discretion of Hillgren, as the general partner. From
January 1 through June 5, 1997, decedent received distributions
totaling $99,363. Hillgren did not receive any distributions
during this period. The distributions that were received by
decedent during 1997 were made specifically to enable decedent to
pay her living expenses, and she was dependent on the cashflow of
the partnership to cover her personal expenses.
LKHP also paid the costs of the estate. On March 5, 1998,
distributions in the amounts of $135,000 and $80,000 were made
from the partnership to the amended trust. The distributions
were applied to pay installments of decedent’s estate taxes due
to the Internal Revenue Service (IRS) and to the California State
Treasurer. From 1998 until 2002, distributions were consistently
made from LKHP to the amended trust to continue payment of
decedent’s estate taxes to the IRS and to the California
Franchise Tax Board.
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