Trying to Think Straight About 41F: Who is a “Responsible Person”?

After stewing over ATF 41F for a few days, the rule is finally starting to make sense to me, at least the definition of the so-called “responsible person” in a gun trust. Of course, it has always been obvious that a Grantor/Trustee of a gun trust is a “responsible person” or RP. However, it seems that co-trustees, special trustees, and beneficiaries of  most any stripe in a well-drafted gun trust might avoid shouldering the burdens of an RP–if they satisfy the conditions in two different rules or sentences in newly amended § 479.11. Here’s the relevant text of that section:

§479.11 Meaning of terms.

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Person. A partnership, company, association, trust, corporation, including each responsible person associated with such an entity; an estate; or an individual.

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Responsible person. 1.) In the case of an unlicensed entity, including any trust, partnership, association, company (including any Limited Liability Company (LLC)), or corporation, any individual who possesses, directly or indirectly, the power or authority to direct the management and policies of the trust or entity to receive, possess, ship, transport, deliver, transfer, or otherwise dispose of a firearm for, or on behalf of, the trust or legal entity. 2.) In the case of a trust, those persons with the power or authority to direct the management and policies of the trust include any person who has the capability to exercise such power and possesses, directly or indirectly, the power or authority under any trust instrument, or under State law, to receive, possess, ship, transport, deliver, transfer, or otherwise dispose of a firearm for, or on behalf of, the trust. Examples of who may be considered a responsible person include settlors/grantors, trustees, partners, members, officers, directors, board members, or owners. An example of who may be excluded from this definition of responsible person is the beneficiary of a trust, if the beneficiary does not have the capability to exercise the powers or authorities enumerated in this section. (emphasis and numbers supplied, except in the section heading)

Slide1

The first rule of the road to freedom from the burdens of a “responsible person” is stated the first sentence in the paragraph labeled “responsible person.” The second rule is in the second sentence of the same paragraph.

Each rule is slightly, but importantly, different from the other. The first rule has one “and” in it. The second has two. Thus, the first rule has two “get out of jail free cards,” the second has three. Cotrustees and beneficiaries must satisfy both rules before they’re free of the “responsible person” burdens imposed by ATF 41F.

Based on all of this, I’m thinking I would analyze the provisions of a trust governing co-trustees or beneficiaries essentially following the logic of these diagrams (click to enlarge), beginning with Rule 1 and then Rule 2, making sure the powers and authorities of each cotrustee, special trustee, or beneficiary are limited in the trust document, so those persons don’t fit within the definition of a “responsible person.” (By the way, it seems that the words “direct” and “possesses” in the rules are particularly important, so I’ve bolded them in the diagrams.)Slide2

What kept bothering me as I initially read the rules and the commentary was that the commentary seemed at times to contradict or modify the actual rules. That confusion was at least in part due to my thinking that there was only one rule in the “responsible person” paragraph in §479.11. Once I finally settled on the idea that there were two different rules or sets of conditions in that paragraph, things started to make a little more sense.

Things made even more sense after I diagramed the two rules or sets of conditions and compared my diagrams to the wording in each part of the commentary that used the actual wording of the rules or paraphrased them in some way. Basically, I asked in each case, did the wording on a particular page of commentary make sense in light of either or both rules or sets of conditions?

What I discovered by doing that is that words in the commentary that at first seemed to be all over the map and had seemed to contradict or confuse the wording in the “responsible person” paragraph in §479.11, suddenly made more sense.

I stress that this is not my final thinking on the subject, and I’m open to correction. More importantly, what I’ve done above doesn’t begin to touch on what some of the words mean in the rule. We need to understand the meaning of words such as “direct,” “management,” “policies,” “possess,” “transfer,” “directly or indirectly,” “capability,” before 41F makes complete sense.

Fun times.

 

 

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