By Kevin Daugherty
In this installment of Land Talk, I’m going to discuss what I call “organized ownership.” Managing joint ownerships, keeping good records, and involving the next generation is extremely important to the business side of rural property ownership and making sure our land is taken care of now and in the future.
A Joint ownership is a property that is held in the name of two or more owners. It can be a real nightmare if the parties don’t get along or have different desires and opinions about how the property should be managed. I see this all the time, and it creates a very awkward situation when I, as a forester or real estate agent, have to assume the role of referee. The scenario typically goes something like this: for one reason or another, the owners haven’t communicated and gotten on the same page about how the property is going to be managed. One or two decide they want to harvest timber or divest of the property altogether. They bring a forester or real estate agent in to attempt to get things rolling and THEN bring the other owners in and propose it to them. For whatever reason, they are against it, and a long and drawn out back-and-forth ensues. This situation often ends in a stalemate where nothing is done at all. Or, even worse, it winds up in court with family members opposing each other.
My advice is to make communication a priority. Don’t wait to talk about it until it’s time to do something. Bring every owner in on a civil conversation. Find out what everyone’s desires for the property are and then attempt to make a plan that satisfies all involved. Don’t leave out the minority (percentage) owners, as they have a say as well. Think ahead about issues you’ll face as an ownership team. Good questions to start with are:
- How can you get documents signed by all owners in a reasonable amount of time?
- Who will be the contact person for hunting lessees, foresters, real estate agents, or other professionals that may get involved? If one or more became owners through heirship, have necessary legal proceedings such as a Succession been completed?
- Should we form an LLC or not?
- Do we want to keep the property long-term, or might we wish to sell it at some point? (this could be a critical factor in deciding whether or not to cut timber or enter into a long-term agreement)?
These are just a few of the issues joint owners face. Keep in mind that, as an owner passes away, he or she may have multiple heirs. That potentially makes one ownership become two or more. Not dealing with these issues up front will likely make things a lot more complicated later down the road. Start now and get these issues resolved before any other action is taken.
Whether you are the sole owner of a rural property or a joint owner, keep organized records. Prepare for the inevitable day when your heirs will need information such as maps, timber cruise and harvest records, information on mineral leases, and contact information for foresters and hunting lessees. Don’t make them have to perform an exhaustive search; make it easy for them.
Get children involved, whether they’re 12 or 30, and make them aware of the details about the property. Don’t assume the next generation is or is not interested. Ask them and listen to what they say. Treat sons and daughters the same, never assuming daughters aren’t interested. Don’t suppress any attempts by the next generation to open the discussion on ownership transition. Regret over conversations not had is a sad thing. Remember, the more they are involved now, the smoother their transition into ownership will be, and, hopefully, the better the property will be managed in the future.
Being organized can increase the enjoyment of land ownership, make the resources easier to manage, and relieve you of some anxiety. Until next time, get out and enjoy your land!
Kevin Daugherty is a forestry and wildlife consultant, real estate agent, and the managing member of ForestLand Associates, LLC. He’s a member of the Association of Consulting Foresters, Louisiana Forestry Association, Society of American Foresters, and is a Land Certification Inspector for the Quality Deer Management Association. He and his wife live in rural Winn Parish. For questions about this article Kevin can be reached at (318) 312-1240 or firstname.lastname@example.org