Legal Question in Business Law in California

Re: Asset Protection in a Trust

Let's make it 4 for 4.

Putting the property into an irrevocable trust now is a dubious strategy. There are circumstances in which it could work, but in almost every circumstance you will end up worse off by doing so.

You need to talk to an attorney, and deal with the lawsuit head on.

Attaching real property is very difficult to do, it is usually a collection agent's threat rather than an actual action.

Contact an attorney, I am available by email, ASAP.

Re: Asset Protection in a Trust

The judge in court will answer that question after hearings on the issue. But, if you're saying you want to now put it in trust, it is way too late, after being sued. The court will also determine the outcome of the the lawsuit, unless you settle it. Unless you are experienced and able to defend yourself in court, hire an attorney to do so. If this is in SoCal courts, and you're serious about doing so, feel free to contact me.

Re: Asset Protection in a Trust

Yes. You can't do what you propose, especially now, it would be set aside as a "fraudulent transfer." You need to hire a lawyer and have the lawyer respond to the lawsuit within 30 days.

Re: Asset Protection in a Trust

Yes, and they can go after you for making a fraudulent transfer. With so much at stake so soon, you need a lawyer immediately. Feel free to contact me directly -- especially if you are in Southern California.

Re: Asset Protection in a Trust

Placing real property in an irrevocable trust in the face of a plaintiff's effort to obtain a prejudgment attachment of the property is almost certain to produce two results: First, the property will be more difficult to attach. This may be a short-term favorable result. However, second, the transfer will be attacked as fraudulent under the Uniform Fraudulent Transfers Act, Code of Civil Procedure sections 3439 to 3439.12, and you and those participating with you will be subject to additional liabilities and penalties, including a court order setting aside the transfer and/or voiding the trust. Tar and feathers aplenty. Don't do it, even offshore.

You are better off resisting the effort to obtain a pre-judgment writ of attachment (if that's what's afoot). They are usually granted only when the plaintiff can prove, before trial, that defendant is not only likely to lose, but also is an untrustworthy person who is likely to hide assets so as to become judgment-proof.

As with any lawsuit, you need to defend, and this usually means filing and serving a responsive pleading such as an answer or demurrer within 30 days. In some cases where relief such as an attachment or TRO are requested, an earlier action on your (defendant's) part may be necessary!

Don't miss any deadlines, give careful attention to any ex-parte or TRO-related hearings, and read and understand everything served on you.

If your residence is threatened, it is all the more necessary to consult with a competent attorney at the earliest possible moment. Be very leery of any advice suggesting hiding assets. That usually backfires with disasterous results, especially where the aggressor plaintiff is angry, rich and/or has competent attorneys.