Garnishment of Debtor’s Interest In An Irrevocable Charitable Trust

Many years ago one of my clients transferred a substantial amount of money to  an irrevocable charitable lead trust. Under the terms of the trust agreement the client receives a stream of income each year, and upon the client’s death all money in the charitable trust goes to a charity. The client wanted to know if trust assets or his  income is vulnerable to his lifetime creditors. Continue reading

Can Bankruptcy Trustee Waive Debtor’s Attorney Client Privilege To Discover Asset Protection Plan?

Some asset protection clients eventually file bankruptcy. A bankruptcy trustee’s job is to find and possible reverse the debtor’s prior asset transfers done in the course of asset protection planning. Some trustees have sought discovery of the debtor’s communication with the debtor’s attorneys who had advised and assisted the debtor with asset protection planning in order to discover asset conveyances and the debtor’s intentions to protect the assets from creditors. There is a legal issue of whether the debtor or the bankruptcy trustee controls the debtor’s attorney-client privilege with pre-bankruptcy attorneys. Continue reading

New York “Separate Entity” Rule And Writs Of Bank Garnishment

One of my client’s recently escaped garnishment of his bank account by New York creditor because of a common law principal in New York known as the “separate entity rule.” The client lived in Virginia and banked at the Virginia branch of a regional banking institution. The bank also had branches in New York City. The creditor obtained a writ of garnishment through a New York court and served the writ on the bank’s New York City branch. Continue reading

Is Debtor’s Copyright Exposed to Execution of Civil Judgement?

A client has a new tech company with what he describes as a valuable copyright. His ex-partner sued him in Virginia federal court and obtained a large judgment which the ex-partner domesticated in Florida. The creditor registered a judgment lien with the Secretary of State. The client is concerned that the lien attaches to the copyright and that the creditor will take the copyright to satisfy the judgement. Continue reading

Florida Court Lacks Jurisdiction To Seize Foreign Checking Account In Forfeiture Action

I have known clients who have opened bank accounts in other states where garnishments are more difficult. These clients have asked me whether a Florida court could issue an order garnishing the account or imposing another order concerning money in out-of-state (foreign) financial accounts. An appellate decision issued last year suggest that Florida courts lack authority to affect foreign state financial accounts. Continue reading

Can You Avoid Lawsuit By Hiding From Process Server?

Many people believe they can indefinitely delay a lawsuit against them by avoiding the process server who is trying to serve the complaint. They plan to live somewhere other than their primary residence, often in locations outside of Florida. Can you avoid a lawsuit by making it impossible for a process server to find you and deliver the complaint. Continue reading

Collection of Domestic Support From Irrevocable Trust

Asset protection against domestic support judgments is very difficult. As an example, one of my clients has been paying substantial alimony to an ex-wife. His surviving parent, who lives in South Carolina, told him that his S.C. estate planning attorney set up a living trust that would protect the client’s future inheritance from his ex-wife by placing the inherited assets in a discretionary spendthrift trust. The client asked me to confirm the protection under Florida law. Continue reading

Are Social Security Benefits Protected From Securities and Exchange Commission Collection?

A caller said that the Securities and Exchange Commission had a civil judgment against him for his violation of federal securities laws. He wanted to know if the SEC could take his social security income when he retires. He said he had read my prior blog entries that said social security is exempt from garnishment, but that he had read something to the contrary on the internet. Continue reading

Garnishment of Credit Card Payment Processor

Experienced collection attorneys may collect a judgment against a small business by garnishing the debtor business’s credit card receipts. This is typically done by serving a writ of garnishment upon the company’s merchant account where credit card receipts are collected. Assume that a creditor is unable to serve a writ of garnishment on the debtor’s merchant bank, is there another way to garnish credit card payments? Continue reading

Florida Exemptions Do Not Protect You In Other States’ Courts

A former client had a judgment entered against him in a New York. The debtor/client lived and worked in Florida. He supported his wife. His employer had offices in Florida and New York, and it paid the client from the Florida office where the client was employed. The creditor caused the New York court to issue a writ of wage garnishment, and it served a writ of garnishment against the employer at its New York office. Continue reading