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failure to perform any meaningful functions as an entity.12 We
conclude that decedent’s transfer to BFLP for a 99-percent
ownership interest in the partnership did not alter his control
of the WCB Holdings class B membership units transferred to BFLP.
See Estate of Thompson v. Commissioner, 382 F.3d at 376-377
(finding “nothing beyond formal title changed in decedent’s
relationship to his assets” where the practical effect on his
relationship to the transferred assets during decedent’s life was
minimal).
B. Conclusion
Under the circumstances of this case, an implied agreement
existed that allowed decedent to retain the enjoyment of the
property held by BFLP. Therefore, under section 2036(a)(1),
decedent’s gross estate includes the value of the WCB Holdings
class B membership units held by BFLP on decedent’s death that is
12Under Minnesota law, the relationship of partners is
fiduciary in character, and each partner owes the other partners
the highest degree of integrity, loyalty, and good faith. Prince
v. Sonnesyn, 222 Minn. 528, 535 (1946); Margeson v. Margeson, 376
N.W.2d 269 (Minn. Ct. App. 1985). In a limited partnership, a
general partner can be liable to the limited partners for breach
of fiduciary duty. Minn. Stat. Ann. sec. 322A.33 (West 2004);
see also Minn. Stat. Ann. sec. 323.20 (West 1995), repealed by
Laws 1997, ch. 174, art. 12, sec. 68, effective Jan. 1, 2002, but
replaced by Minn. Stat. Ann. secs. 323A.4-04 and 323A.4-05,
effective Jan. 1, 1999 (West 2004). In addition, the ISA Trust
trustees owed fiduciary duties to its beneficiaries. See Minn.
Stat. Ann. sec. 501B.10 (West. Supp. 1990), repealed by Laws
1996, ch. 314, sec. 8, eff. Jan. 1, 1997, replaced by Minn. Stat.
Ann. sec. 501B.151, effective Jan. 1, 1997 (West 2002 & Supp.
2004); Minn. Stat. Ann. sec. 501B.60 (West 1990).
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