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Will a trust protect you from a lien? I'm not speaking about the
obligation of the debt. I am simply looking to protect my property. I
know it does not protect you in a law suit where a court has issued a
verdict.
Any pointers to clear definitions of what a trust can and can't do?
--
Kirk
"Screw the planes, take a train", Me
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'Captain' Kirk DeHaan wrote:
Will a trust protect you from a lien? I'm not speaking about the
obligation of the debt. I am simply looking to protect my property.
I
know it does not protect you in a law suit where a court has issued a
verdict.
Your use of that terminology indicates you have little concept of what
you're talking about. Just about the only thing that _could_ result
in a lien being placed on your property, other than your voluntary
assent to a properly recorded loan contract in which the property is
specifically offered as collateral (in which case the lien would
already be there), is having a court judgment issued against you in a
lawsuit. It sounds like what you are asking is, how can you shield
that particular piece of property from the effects of such a potential
(future) judgment. And you are correct that this is hard, but not
always impossible, to do.
First of all, if a claim against you is already pending, it's probably
too late. Anything you do to shield that property would be considered
fraudulent as against your creditors and would be subject to being
undone by the court to enable the creditors to grab your property.
But even if there's no claim pending now, and even if the creation of
the trust is done right -- no matter how you structure the trust, if
_you_ still have an equity claim to the property that is in trust, or
as a beneficiary of the trust, your creditor could almost always attach
_your_ interest in the property as part of _your_ financial estate.
There are very narrow and limited exceptions to this which you should
consult a local lawyer about in confidence to see if they will
accomplish what you want, or whether what you want can even be done.
The problem is, to do it right and shield the property, you would
almost certainly have to _bona_fide_ give up all control over the
current as well as future use and disposition of the property, which in
effect means give it away now to a trust in which you held no equity
interest.
Any pointers to clear definitions of what a trust can and can't do?
There are whole books, nay, multi-volume treatises, written on what
trusts can and cannot do. You can find them at any law library, eg at
your local courthouse, and also in many well-stocked public libraries.
You would have to be a lot more specific to get any meaningful replies
about a particular scenario, and in any event you are best urged to
consult a local lawyer for real advice if this is a real need and not
just a hypothetical musing on your part. Have them do it right, and
you will have their malpractice insurance to back you up if they make a
mistake. Do it yourself, and you will only stew in your own juices if
you screw up. Good luck,
--
This posting is for discussion purposes, not professional advice.
Anything you post on this Newsgroup is public information.
I am not your lawyer, and you are not my client in any specific legal
matter.
For confidential professional advice, consult your own lawyer in a
private communication.
Mike Jacobs
LAW OFFICE OF W. MICHAEL JACOBS
10440 Little Patuxent Pkwy #300
Columbia, MD 21044
(tel) 410-740-5685 (fax) 410-740-4300
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'Captain' Kirk DeHaan wrote:
Will a trust protect you from a lien? I'm not speaking about the
obligation of the debt. I am simply looking to protect my property. I
know it does not protect you in a law suit where a court has issued a
verdict.
Any pointers to clear definitions of what a trust can and can't do?
I'm guessing you mean protect the settlor of a trust. If a court
believes that the movement of assets into a trust meet the definition of
fraudulant conveyance, the trust can be broken and the assets attached
or siezed.
Fraudulant conveyance can mean different things in different areas and
in different contexts. It's not an easy subject and one that's been
subject to many court decisions. Essentially you need to assess what you
are fearful of, what your current situation is, and where the trust will
be formed before having even a slight idea of what your risk profile is.
-paul
ianal
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