Large-scale NFA Trusts for "diffuse" possession of firearms

[Arizona_Mike]

Frank, I want to be absolutely sure I understand what you are saying.

In the situtaution where a "firearm" is shipped from the trust by trustee #1 to the trust in care of trustee #2 who resides in a different state (assume it is temporary for now), then the requirements would vary as follows?

MG,DD,SBR,SBS: approved form 5320.20 no FFL needed, no form 4473.
Title 1 Firearm: Form 4473 and FFL??
SBR,silencer: optional form 5320.20 and no FFL or Form 4473 and FFL???

I know you are a lawyer and I am not but this is not making much sense to me at all.

Mike

 

[tepin]

Information on shipping:
http://www.thehighroad.org/showthread.php?t=651375
Instructions on 5320.20 page 2 of 2:
http://www.atf.gov/files/forms/download/atf-f-5320-20.pdf

 

[Arizona_Mike]

Thanks for the links tepin. It is a convenient restatement of everything I have read. The more I read the more convinced I am that a trust could ship a Title I firearm owned by the trust to itself in care of an out of state "Person". (just as a natural person can).

6. May I lawfully ship a firearm to myself in a different State?
Any person may ship a firearm to himself or herself in the care of another person in the State where
he or she intends to hunt or engage in any other lawful activity. The package should be addressed to
the owner “in the care of” the out-of-State resident. Upon reaching its destination, persons other than
the owner must not open the package or take possession of the firearm.

I also believe that the trustee who is a resident of a different state than the grantor can possess the firearm because he (or she) is a trustee and possession is inherent to being as trustee.

This is the exact question I have been asking.

I do not believe that that for firearms that do not require a Form 5320.20, a Form 4473 (and involvement of an FFL) would be needed for the Trust shipping to itself. Nor do I believe that if there was such a requirement the use of a Form 5320.20 (for a SBR/SBS/MG/DD but not AOW/Silencer/Title I) would somehow trump it.

Mike

 

[Frank Ettin]

...The more I read the more convinced I am that a trust could ship a Title I firearm owned by the trust to itself in care of an out of state "Person". (just as a natural person can).


I also believe that the trustee who is a resident of a different state than the grantor can possess the firearm because he (or she) is a trustee and possession is inherent to being as trustee....

It's nice that you believe that. The question is whether you could get a judge to believe it. And I very much doubt that.

What you fail to understand about the general law of trusts is that a trust is not an entity. It is not an "artificial person." It does not act in its own name.

A trust is a device for holding property. The trustee, as a natural person (or artificial person), has legal title to property which he must hold for the benefit of the beneficiary of the trust in accordance with the trust document.

If a trustee has physical possession of a thing and hands it to another person, that is an ordinary transfer. If the thing is a gun, the transfer (change of possession) is subject to whatever laws apply to such a transfer. If it's between residents of different States federal law applies.

 

[Arizona_Mike]

It's nice that you believe that.

The High Road?

If a Form 4473 is required, what is it about the Form 5320.20 process that would waive that for Title II Firearms that you seem to imply in a previous post (post 21)? It says right on the back of the Form 5320.20 "THE AUTHORIZATION DOES NOT CARRY OR IMPORT RELIEF FROM ANY STATUTORY OR REGULATORY PROVISIONS RELATING TO FIREARMS OTHER THAN 27 CFR 478.28" What about those Title II firearms that do not require a Form 5320.20 such as AOWs and Silencers?

. . . a trust is not an entity. . . . The trustee, as a natural person (or artificial person), has legal title to property.

You are correct that I was not aware of that but thank your for that information*. In that case however, isn't a co-trustee already an owner of the firearm? Also, would adding a co-trustee to a trust with existing firearms be a "sale" under 28 USC 922?

Mike

*- The reason for assuming otherwise is from ATF instructions and correspondence. I was requested by the ATF to cross out remove "c/o My Name" under the trust Name in under "Applicant" and the form instruction say to mark "Corporation or Other Business Entiry" under "Application is made by:".

 

[Frank Ettin]

If a Form 4473 is required, what is it about the Form 5320.20 process that would waive that for Title II Firearms that you seem to imply in a previous post (post 21)? It says right on the back of the Form 5320.20 "THE AUTHORIZATION DOES NOT CARRY OR IMPORT RELIEF FROM ANY STATUTORY OR REGULATORY PROVISIONS RELATING TO FIREARMS OTHER THAN 27 CFR 478.28" What about those Title II firearms that do not require a Form 5320.20 such as AOWs and Silencers?

. . . a trust is not an entity. . . . The trustee, as a natural person (or artificial person), has legal title to property.

You are correct that I was not aware of that but thank your for that information*. In that case however, isn't a co-trustee already an owner of the firearm? Also, would adding a co-trustee to a trust with existing firearms be a "sale" under 28 USC 922?

Mike

*- The reason for assuming otherwise is from ATF instructions and correspondence. I was requested by the ATF to cross out remove "c/o My Name" under the trust Name in under "Applicant" and the form instruction say to mark "Corporation or Other Business Entiry" under "Application is made by:".

You seem to insist on mixing discussion of Title I firearms with discussion of matters regulated under the NFA. That is inappropriate.

The Latin phrase, lex specialis, is used to describe a fundamental legal doctrine:

...a law governing a specific subject matter overrides a law that only governs general matters...

So with respect to firearms or other devices regulated under the NFA, the NFA and associated regulations will govern to the extent the particular issue is addressed in those statutes and/or regulations. General firearms law will apply to NFA items only to the extent an issue is not addressed in the NFA statutes or regulations.

To the extent that you might have NFA items or have formed a trust for holding NFA items, I'm not going to give you any advice regarding such. You need to consult your own lawyer.

With regard to Title I firearms, I've cited the federal statutes from the Gun Control Act of 1968 dealing with interstate transfers. Those statutes say what they say.

BTW, have you read 27 CFR 478.28? If not, here's what it says:

478.28 - Transportation of destructive devices and certain firearms.

(a) The Director may authorize a person to transport in interstate or foreign commerce any destructive device, machine gun, short-barreled shotgun, or short-barreled rifle, if he finds that such transportation is reasonably necessary and is consistent with public safety and applicable State and local law. A person who desires to transport in interstate or foreign commerce any such device or weapon shall submit a written request so to do, in duplicate, to the Director. The request shall contain:

(1) A complete description and identification of the device or weapon to be transported;

(2) A statement whether such transportation involves a transfer of title;

(3) The need for such transportation;

(4) The approximate date such transportation is to take place;

(5) The present location of such device or weapon and the place to which it is to be transported;

(6) The mode of transportation to be used (including, if by common or contract carrier, the name and address of such carrier); and

(7) Evidence that the transportation or possession of such device or weapon is not inconsistent with the laws at the place of destination.​

(b) No person shall transport any destructive device, machine gun, short-barreled shotgun, or short-barreled rifle in interstate or foreign commerce under the provisions of this section until he has received specific authorization so to do from the Director. Authorization granted under this section does not carry or import relief from any other statutory or regulatory provision relating to firearms.

(c) This section shall not be construed as requiring licensees to obtain authorization to transport destructive devices, machine guns, short-barreled shotguns, and short-barreled rifles in interstate or foreign commerce: Provided, That in the case of a licensed importer, licensed manufacturer, or licensed dealer, such a licensee is qualified under the National Firearms Act (see also Part 479 of this chapter) and this part to engage in the business with respect to the device or weapon to be transported, and that in the case of a licensed collector, the device or weapon to be transported is a curio or relic.

Basically, the authorization to transport under 27 CFR 478.28 is only that (i. e., authorizes the transportation of the item).

 

[Arizona_Mike]

Frank, I do not have any co-trustees and no Title I firearms in trust. My interest is purely educational.

I was addressing ChaosS's original question which I assumed was only about Title I firearms. The problem is that most reference material on the web with respect to trusts seems to be NFA-specific. For example when I linked to this article I was not trying to change the subject to Title II firearms but asking about this logic behind the statement "There is no requirement to use a FFL as the owner is not changing. The Gun Trust will be the owner of the firearm prior to and after the shipment." as it applied to Title I firearms. Is David Goldman mistaken in what constitutes a transfer under 18 USC 922 (which applies to both Title I and Title II transfers if I am not mistaken).

So I will avoid any possible confusion and ask specifically about what is needed for one trustee to sent a Title I firearm (in the trust) to another trustee in another state?

Those statutes say what they say.

Indeed they do. I was asking about how they are interpreted with respect to firearms in a trust and what is interpreted to be a "transfer".

Mike

 

[Bill_Rights]

I am duly amazed and humbled, as OP, that you all went into so much depth and handled all aspects of the issue. Thank you all.

Thanks, Frank, for calling me/us back constantly to the legal fundamentals. For ex.

...the general law of trusts is that a trust is not an entity. It is not an "artificial person." It does not act in its own name. ... A trust is a device for holding property. The trustee, as a natural person (or artificial person), has legal title to property which he must hold for the benefit of the beneficiary of the trust in accordance with the trust document.

This puts importance on the beneficiary. To me, now, the beneficiary is of little concern. I just want the trust to hold property for use while I (a trustee) live. How easy is it to remove old beneficiaries and add ne beneficiaries? At least one files an amended trust document, I assume.

Mike's hanging question is important to me, too:

what is needed for one trustee to sent a Title I firearm (in the trust) to another trustee in another state?

Since there was no answer, was this question effectively answered in prior posts?

 

[Frank Ettin]

....Mike's hanging question is important to me, too:

what is needed for one trustee to sent a Title I firearm (in the trust) to another trustee in another state?

Since there was no answer, was this question effectively answered in prior posts?...

General federal law dealing with the interstate transfer of firearm was set out in post 19. "Transfer" refers to possession, not necessarily just title. So I can see no reason why those statutes would not apply to a trustee in one State transferring possession of a Title I firearm to a trustee in another State.

In the case of a Title II firearm, the matter of transferring possession from a trustee in one State to a trustee in another appears to be addressed in 27 CFR 478.28. But that would not apply to a Title I firearm, thus leaving a Title I firearm subject to 18 USC 922(a)(3) and 922(a)(5).

 

[Bill_Rights]

Thanks, Frank.

I will try to follow all the posts you and the others made and see if I understand it all. I am glad I do have a trust lawyer familiar with simple, single-family NFA trusts. I definitely need a lawyer. I fear to ask him about a large-scale, multi-family, multi-state NFA trust, for fear of him blowing a fuse, which, translated, means it's going to cost me lotsa cabbage $$$.

Do you agree with Arizona Mike's assertion? (in Post #9198532 November 12, 2013 09:57 PM):

A 5320.20 is required for a SBR, SBS, MG, and DD. Not required for an AOW or silencer.

Recall, in my OP, the original reason I looked into an NFA trust and deviated from Title 1 firearms at all was to facilitate multi-user, interstate use of suppressors.

 

[Frank Ettin]

...I am glad I do have a trust lawyer familiar with simple, single-family NFA trusts. I definitely need a lawyer. I fear to ask him about a large-scale, multi-family, multi-state NFA trust, for fear of him blowing a fuse, which, translated, means it's going to cost me lotsa cabbage $$$.

Do you agree with Arizona Mike's assertion? (in Post #9198532 November 12, 2013 09:57 PM):...

I have no opinion, and I'm not going to do the research.

You'll need to pay your own lawyer.

 

[Bill_Rights]

No prob. I understand. Thanks.

 

[Arizona_Mike]

General federal law dealing with the interstate transfer of firearm was set out in post 19. "Transfer" refers to possession, not necessarily just title. So I can see no reason why those statutes would not apply to a trustee in one State transferring possession of a Title I firearm to a trustee in another State.

In the case of a Title II firearm, the matter of transferring possession from a trustee in one State to a trustee in another appears to be addressed in 27 CFR 478.28. But that would not apply to a Title I firearm, thus leaving a Title I firearm subject to 18 USC 922(a)(3) and 922(a)(5).

Thanks for clarifying that you don't think 18 USC 922(a)(3) and 922(a)(5) applies to Title II firearms. I thought that was what you meant but was not sure. I believe that once the Form 4 comes back a 4473 follows when you pick up the item so now I am wondering why?

If the question were ever more than academic I'd want to trace the definitions in each stature carefully (and probably ask the ATF) rather than just assume lex specialis applied.

Mike

 

[Arizona_Mike]

Bill Rights, Section 13.8 of the April 2009 edition of the ATF National Firearms Handbook states:

Section 13.8. Requesting permission to transport certain firearms in interstate or foreign
commerce. A person, other than an FFL/SOT, may not lawfully transport in interstate or foreign
commerce any destructive device, machinegun, short-barreled shotgun, or short-barreled rifle,
without prior written approval of ATF, specifically the NFA Branch. [Footnote: 214]
For definitions of these firearms and devices, refer to 27 CFR 478.11. Licensed collectors are not
required to obtain such approval if the firearms and devices being transported are “curio or relic”
firearms under the GCA. Approval for the transportation may be obtained by (1) a written request
or (2) an approved application filed with ATF on Form 5320.20.

214: 18 U.S.C. 922(a)(4); 27 CFR 478.28

AOWs and Silencers are not on the list.
Prior to re-reading this just now I was not conscious of the C&R exemption!

Now looking at the footnoted statute 18 U.S.C 922(a)(4):

for any person, other than a licensed importer, licensed manufacturer, licensed dealer, or licensed collector, to transport in interstate or foreign commerce any destructive device, machinegun (as defined in section 5845 of the Internal Revenue Code of 1986), short-barreled shotgun, or short-barreled rifle, except as specifically authorized by the Attorney General consistent with public safety and necessity;

Again, AOWs and silencers are not on the list.

I know I am not a lawyer and Frank is, but I would be shocked if 18 U.S.C. 922(a)(4) applied to Title II weapons and 18 U.S.C. 922(a)(2) did not!
Going to the definitions section of 18 U.S.C. (18 U.S.C. 921):

(a) As used in this chapter—
. . .
(3) The term “firearm” means
(A) any weapon (including a starter gun) which will or is designed to or may readily be converted to expel a projectile by the action of an explosive;
(B) the frame or receiver of any such weapon;
(C) any firearm muffler or firearm silencer; or
(D) any destructive device. Such term does not include an antique firearm.

Title II weapons also expel projectiles and a silencer is on the list! It would appear that Title II weapons are also firearms under 18 U.S.C. I'm not sure lex specialis would apply here when the statutory language is rather clear. Also the original NFA is the older law (and the GCA '88 had both Title I and Title II provisions in the same statute) so lex specialis would be competing with lex posterior . . .

Based on the statutes themselves, the fact that you fill out a Form 4473 when you pick up your NFA weapon from a dealer, and the fact that three categories of NFA weapons do not require a Form 5320.20 (and thus would not "trump" a Form 4473 by lex specialis), I again we come back to my original suspicion that both sets of requirements apply to Title II firearms but that the ATF does not consider a physical trustee-to-trustee possession handover to be a transfer. I should probably ask them when I get some time.

Mike

 

[Bill_Rights]

@ Arizona_Mike,

Thanks for the detailed summary and explanation!

When we use the acronym "AOW", that means "Any Other Weapon"? I can't find any other definition on acronymfinder.com, for ex. (I forgot to check THR's own acronym list sticky.)

When you say you will ask BATF about some of these things, how would you do that? Just pick up the phone and call Washington? Or is there a field office you could just walk into? Regardless, I suspect that any chair-warmer in an office at BATF is going to play it really conservatively and tell you all sorts of restrictions that go beyond the actual or tested (in court) meaning of the laws. There is a tendency toward "CYA", if you know what I mean.

It is entirely possible that the laws do not make sense, when taken in aggregate. That is, they conflict or there are significant gaps. In fact, that is an intended technique of Congress (including the Senate) since 1975. Basically, Congress (intentionally) fails to actually make laws but merely confers authority to the (unelected, unaccountable) federal agencies to write regulations. The agencies invariably botch the job, then the courts get involved.

So, the upshot is, we need to search out the written regs plus look up any court case decisions, in order to really understand what the "law" means. (I am sure Frank understands this, and it is a lot of work, so that is one reason he is hesitating....) But if you doubt that this is how the administrative state now works, in conjunction with Congress, consider ObamaCare: 2700 page bill, 30,000 pages of regs and still accelerating/not near done and 42 law suits from the ACLJ alone, 27 law suits from State AGs and probably 100 more assorted law suits. No one knows what the "law" (that is, the statute, the bill) says or means, and it doesn't matter because whatever it could be imputed to mean, it will be changed by the agency regs and the court decisions. This is radically unsuitable!

But I hope the situation we have been discussing is not as extreme as that...

 

[Bill_Rights]

"law" in the administrative state

Incidentally, my authority for how Congress and law now work is:

John Marini, "Budget Battles and the Growth of the Administrative State", Imprimis magazine (Hillsdale College), October 2013 • Volume 42, Number 10.

 

[Arizona_Mike]

@ Arizona_Mike,
When you say you will ask BATF about some of these things, how would you do that?

Like I said my interest is not currently practical, but I'd start here: How to Request Variances, Exemptions, and Determinations

Most ATF agents are honest folks trying to interprate very complex and archaic laws. They are also very frank. Their own History of the NFA page, for example:

While the NFA was enacted by Congress as an exercise of its authority to tax, the NFA had an underlying purpose unrelated to revenue collection. As the legislative history of the law discloses, its underlying purpose was to curtail, if not prohibit, transactions in NFA firearms. Congress found these firearms to pose a significant crime problem because of their frequent use in crime, particularly the gangland crimes of that era such as the St. Valentine’s Day Massacre. The $200 making and transfer taxes on most NFA firearms were considered quite severe and adequate to carry out Congress’ purpose to discourage or eliminate transactions in these firearms. The $200 tax has not changed since 1934.

In 1934 $200 of three months of average American household income.

There have been very few crimes committed with registered NFA weapons. For a long time the claim of only 2 murders (one by a cop) were probably true. More recently two more cops ran amuck with NFA weapons (one in the Northwest and most recetly Dorner) and there was a murder conviction on a cold case where a wife may have used her husband's silencer against him a couple decades before.

Mike

 

[Arizona_Mike]

A recent BATF determination letter has bearing on this very question.
http://www.guntrustlawyer.com/ATF 13-0574 -4473 Trus tResponse Letter.pdf

It is not the exact situation the OP asked but the reasoning was that an unincorporated trust is not a person under the GCA and the transfer "thus, when an FFL transfers an NFA firearm to a trustee or other person acting on behalf of a trust, the transfer is made to this person as an individual (i.e., not as a trust)".

This is a reversal!

(Actually individual ATF offices/agents have been giving different answers according to this blog)

It seams that the ATF has just recently acted on Frank's reasoning that an unincorporated trust is not a person (they either previously considered that it was for the purposes of the GCA or they just overlooked the implication). At the same time we are seeing the GCA transfer provisions applied to NFA items as I theorized it would (irrespective of lex specialis).

This does not bode well for the OP's question with respect to Title I firearms. Perhapse the subject should be "Large-scale NFA Corporations for "diffuse" possession of firearms".

Mike

PS. Here is the letter that opened this can of worms: http://www.dakotasilencer.com/NICS_Check_on_Trustee_4473_ATF_Dakota_Silencer.pdf Some people are directing hate at Dakota Silencer but it I was in their position and got conflicting advice from the ATF and saw conflicting statements in the handbook and previous letters I would be concerned too.