1 minute reading time (268 words)

FOREIGN-HELD ASSETS FOUND TO BE ASSET PROTECTED

In Sargeant v. Al-Saleh,[1] a Florida District Court of Appeal (the “Court”) held that a Florida trial court does not have in rem jurisdiction over assets held in a foreign jurisdiction, and therefore did not have the authority to order Florida-based debtors to turn over foreign stock certificates. 

In Sargeant, a creditor obtained a $20 million judgment against the debtors for proceeding with a corporate business arrangement without sharing the profits.  The creditor asked the trial court to order the debtors to turn over all corporate stock certificates.  The debtors argued that such stock certificates represented assets located outside the United States, and therefore, the trial court lacked jurisdiction to compel their turnover.  The trial court ruled in the creditor’s favor.

The Court overturned the trial court’s ruling for two reasons.  First, “there may be competing claims to the foreign assets and we believe ‘that claims against a single asset should be decided in a single forum and . . . that forum should be, as it traditionally has been, a court of the jurisdiction in which the asset is located.  Second, we emphasize that allowing trial courts to compel judgment debtors to bring out-of-state assets into Florida would effectively eviscerate the domestication of foreign judgment statutes.”[2]

Applying Sargeant to the principles of integrated estate planning, individuals who have created offshore trusts may find some added comfort that such assets would be all the more difficult for creditors to attach where the foreign trustee holds custody of the assets outside of the U.S.


[1]  Case No. 4D13-1447 (D.C.A. Fla. 4th Dist. March 5, 2014).

[2]  Id. at 2.

 

"CARRIED INTERESTS” STILL IN CONGRESS’S CROSSHAIRS
OBLIGATION OF ONE'S AGENT TO FILE AN FBAR

Seminars & Events:

April, 2017 - CELESQ
“An Asset Protection Planning Primer for Estate Planning, Tax and Creditors Rights Lawyers”
Live Web Cast
May 31 – June 1, 2017 - 

SOUTHPAC TRUST OFFSHORE PLANNING INSTITUTE CONFERENCE 2017, “Asset Protection in a Changing World” (31 May 2017) and “Questions & Answer Panel on Industry Challenges to Asset Protection Structures” (1 June 2017)
Las Vegas, Nevada

 

View More Recent Seminars and Events

Contact Information

Barry S. Engel
Email: info@engelreiman.com