NFA Trust Not Notarized? Drafted by FFL dealer?

[Jackal]

A local class 3 dealer here in WA informed me that the NFA trust they offer does not require notary. First of all, is it even legal for a FFL dealer to setup a trust for you? Secondly, doesnt the trust have to be notarized? I was under the impression that only people licensed to practice law or you, yourself could draft up your own legal trust . I was also under the impression that a NFA trust had to be notarized (I had mine notarized). Is the dealer practicing shady business or am I being paranoid here?

 

[morcey2]

Is the dealer practicing shady business or am I being paranoid here?

Those two aren't necessarily mutually exclusive.

And I don't know the answer either, but I'm pretty sure that there's at least one nearby FFL that's doing the same thing.

Matt

 

[Frank Ettin]

...First of all, is it even legal for a FFL dealer to setup a trust for you? Secondly, doesnt the trust have to be notarized? I was under the impression that only people licensed to practice law or you, yourself could draft up your own legal trust . .....

First, yes, only a lawyer properly licensed to practice law in a particular jurisdiction can practice law. But someone giving you a document and telling you this is a trust document, isn't necessarily practicing law. Now where the practice of law comes in is when someone draws up a legal document for you having assessed your needs and goals and then represents to you that he believes what he has prepared will satisfy your needs and goals.

There are all sorts of form documents -- trusts, deeds, powers of attorney, wills, etc., -- floating around in cyberspace. Go on-line, print one out, fill in the blanks, and you're all set. Or are you? Will it serve your needs? Will it accomplish what you want accomplished? Given your family situation? Given your financial situation? Given your tax situation? Maybe and maybe not.

So if someone other than a licensed lawyer does anything more than hand you a form, he's practicing law illegally. If you use that document, I think you're taking a big risk that it won't do what you want. It's still "legal", i. e., peoples' rights and obligations will be decided by a court in accordance with what's written there; but the outcome might not be what you hoped for.

As far as being notarized, in general trust documents don't need to be notarized -- although there might a law in some State that requires some type of trust to be notarized.

I have my suits and shirts made for me by a tailor according to my measurement so they fit properly. Similarly, I have my legal documents prepared by qualified lawyers after consulting with me about my situation, needs, and goals -- so that they fit properly. I know that a lot of people can get along perfectly well with clothing bought "off-the-rack." But with legal documents too much is usually at stake to rely on "off-the-rack" forms.

 

[Theohazard]

I know of several dealers in WA in the Seattle area who offer free form trusts to NFA customers. I used to work at one of them several years ago, it was just a revocable living trust the owner found online (and I'm pretty sure it was the same one the other dealers in the area used). We tried to make sure to explain to the customer that we weren't "setting up a trust" for them, we were simply providing them with trust paperwork that they could set up for themselves. That said, I wasn't always comfortable with the degree to which many employees seemed to offer advice on the trust. That's why I was glad when I went to work at another nearby WA dealer who didn't offer trusts and worked a lot harder to avoid giving legal advice.

Remember: back before 41F, there was no way most people in the Puget Sound area were going to get a sign-off for an NFA item, so a trust was mandatory for most people who wanted to buy one. The idea was that the dealer wanted to make it as easy as possible for the customer to buy an NFA item.

That second shop I worked at referred customers to an actual group of local lawyers who specialized in NFA trusts. One of those lawyers was a regular at our shop (he re-drafted the generic form trust I got at my first shop into a proper trust for me), and I spent a lot of time chatting with him. One thing he told me was that WA state law doesn't require a trust to be notarized. But he eventually set up his trusts to be notarized primarily because he was tired of the ATF erroneously denying his customers' trusts simply because they weren't notarized.

As a manager at the second shop (the one who didn't offer a free trust), I tried to make it clear to my employees that we weren't there to offer legal advice on trusts. The problem was since we mostly dealt with trusts written up by that one local NFA trust lawyer group, we often knew when a customer was missing an important part of the trust that would cause the ATF to reject it. In those cases, to avoid giving legal advice, our policy was simply to point out to our customers that -- in our store's experience -- if we submitted the copy of the trust as it was, the ATF would probably reject it. But if the customer insisted, we would still happily submit the trust as it was. Like I told my employees, we weren't lawyers; if a customer gave us a sheet of newspaper to submit with the Form 4 and told us that's his trust, we'd submit it for him.

 

[Jackal]

I know of several dealers in WA in the Seattle area who offer free form trusts to NFA customers. I used to work at one of them several years ago, it was just a revocable living trust the owner found online (and I'm pretty sure it was the same one the other dealers in the area used). We tried to make sure to explain to the customer that we weren't "setting up a trust" for them, we were simply providing them with trust paperwork that they could set up for themselves. That said, I wasn't always comfortable with the degree to which many employees seemed to offer advice on the trust. That's why I was glad when I went to work at another nearby WA dealer who didn't offer trusts and worked a lot harder to avoid giving legal advice.

Remember: back before 41F, there was no way most people in the Puget Sound area were going to get a sign-off for an NFA item, so a trust was mandatory for most people who wanted to buy one. The idea was that the dealer wanted to make it as easy as possible for the customer to buy an NFA item.

That second shop I worked at referred customers to an actual group of local lawyers who specialized in NFA trusts. One of those lawyers was a regular at our shop (he set up my trust for me), and I spent a lot of time chatting with him. One thing he told me was that WA state law doesn't require a trust to be notarized. But he eventually set up his trusts to be notarized primarily because he was tired of the ATF erroneously denying his customers' trusts simply because they weren't notarized.

As a manager at the second shop (the one who didn't offer a free trust), I tried to make it clear to my employees that we weren't there to offer legal advice on trusts. The problem was since we mostly dealt with trusts written up by that one local NFA trust lawyer group, we often knew when a customer was missing an important part of the trust that would cause the ATF to reject it. In those cases, to avoid giving legal advice, our policy was simply to point out to our customers that -- in our store's experience -- if we submitted the copy of the trust as it was, the ATF would probably reject it. But if the customer insisted, we would still happily submit the trust as it was. Like I told my employees, we weren't lawyers; if a customer gave us a sheet of newspaper to submit with the Form 4 and told us that's his trust, we'd submit it for him.

This shop is setting the generic revocable living trust up for the customer and basically just having them sign on the lines and check the data for correctness. They are in their first year of class 3 licensing, it'd be a pity if they are selling non legal trusts for $100...

 

[Theohazard]

This shop is setting the generic revocable living trust up for the customer and basically just having them sign on the lines and check the data for correctness.

The several shops I’m referring to are simply providing free generic trust paperwork to the customer during an NFA purchase and having them write their name in, write in their beneficiaries, and sign it where necessary. There’s no “setting up” of a trust by the FFL. And as Frank pointed out, if they do it that way they’re not necessarily practicing law without a license.

Are you saying that the shop you’re referring to is doing more than that?

They are in their first year of class 3 licensing, it'd be a pity if they are selling non legal trusts for $100...

Wait, are you saying they’re charging for these trusts? The shops I’m referring to provided these trusts free as part of an NFA purchase. After all, it makes sense for the FFL to make it easier for the customer to purchase an NFA item. And by simply providing the trust paperwork for free, it probably made them feel they were less likely to be accused of practicing law without a license. Also, since they simply downloaded generic trust paperwork they found free online, it’s not like it cost the FFL much to provide it.

 

[Frank Ettin]

....it'd be a pity if they are selling non legal trusts for $100...

It's possible that what the FFL is doing isn't legal, i. e., practicing law without a license. That doesn't mean that the trust isn't legal, i. e., that a court would not give the trust legal effect.

It's more complex and pernicious than that. The problem is that the trust might not serve the purposes of the "buyer", i. e., the legal effect given the trust will not be exactly what the buyer wanted or will somehow disadvantage the buyer.

 

[pintler]

I'll leave the nuances of what is/is not practicing law to the experts, but merely providing forms isn't necessarily practicing law. For example, there is a place called Nolo Press whose business is selling books/forms for DIY wills, leases, trusts, yadda, yadda. In the fireams business, Silencershop sells trust forms; they are a big enough operation that I suspect that's legit.

Whether using those is smart depends on a lot of things. For example, suppose I'm single and have a slight preference that my estate go to charity X, versus whatever the intestate rules are for my state. I might decide that, all things considered, spending $10 or whatever on the Nolo wills book beats spending $2000 on a custom will. A reasonable person could say 'whatever, if the DIY will turns out to be bogus, what do I care, I'll be dead'. OTOH, if you're creating a complex will and you really care that it work as intended, then you probably want to pony up for a lawyer. Horses for courses and all that.

I have a 60 some page lawyer crafted trust. When we met to set it up, he extolled how it would help ease the inheritance of NFA items, etc. I'm sure that matters to someone with a $500K collection of machine guns, but it matters less to me. If I get hit by the proverbial beer truck tomorrow, I suspect my widow will be disposing of 90% of the guns (and 100% of the machine tools), hopefully at firesale prices to friends. If she just hands the suppressors over to the police for disposal, OK, whatever is the least hassle for her. I did the trust solely to make sure there was zero chance of her getting into some kind of constructive possession trouble. TBH, if I had it to do over I'd probably look hard at the Silencershop trust. YMMV.

 

[Elkins45]

I paid an actual lawyer to prepare my trust, mostly because if something goes wrong I would have someone to blame

Post 41F if I ever buy any new NFA items I will probably just file as an individual so my wife doesn't have to roll prints.