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Washington State sales tax to the State, and disbursement of
funds to petitioners; and (4) performing necessary repairs or
maintenance to make Moonshadow charter ready.8 For these
services, petitioners paid AYC a commission, after deducting the
turn fee, of 30-percent of the gross charter fee (or 20-percent
of the gross charter fees for charters arranged by petitioners).9
The contract further provided that petitioners: (1) Reserved no
right to nonbusiness private use of Moonshadow; (2) agreed to pay
AYC a commission of 5-percent if they leased Moonshadow for
personal use; and (3) agreed to insure Moonshadow at their own
expense under the AYC group insurance program.
Typically, AYC’s contracts with individual charterers set
forth the terms of a charter period as follows:
A CHARTER WEEK is 7 days/6 nights. Example: Noon
Sunday to Noon Saturday. Daily pro-rated items are
based on number of days in charter.
At the end of each month, AYC would mail petitioners a detailed
income activity statement indicating the name of the charterer,
8 The contract authorized AYC to spend up to $500 for
repairs or maintenance needed to make the vessel ready for the
next charter. AYC was required to make every reasonable effort
to contact petitioners before authorizing repairs or maintenance
in excess of $500, or to provide notice at the first opportunity
if contact was not possible.
9 Petitioners elected to pay the optional turn fee (which
provides that AYC personnel will clean Moonshadow after every
charter) because “being that it’s [Moonshadow] located where it
is, it would be--and we work full time--it makes sense to have
them [AYC] take care of it for us.”
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Last modified: May 25, 2011