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Testimonials

"Jackson & Wilson came highly recommended to us from a Superior Court Judge who is a good friend of ours.  We were pleased with both the high level of professionalism and the constant concern for our best interest.  We were always kept well informed of the status of our case.  We feel highly confident in referring Jackson & Wilson to others."

-- Mr. Chris B (Local contractor and Laguna Niguel family man)

"Your firm helped me through one of the most difficult time of my life. You were all so gracious about any questions I had.  The speed with which you brought my legal case to a fair and fast conclusion was so appreciated and I am sure I would not be in the position I am in if you hadn’t resolved it and got the monetary help for me."

-- Ms. Elaine A.  (Retired and active senior citizen)

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Case Results

Most of our new clients are referred to us by past clients and other attorneys in our community.  Why?  Because they know we "walk the talk" and have the experience and expertise to get solid results.  Here are a few examples...

$5,000,000- Wrongful death and catastrophic injury

$3,347,000- Catastrophic injury and Insurance Bad Faith

$1,250,000- Wrongful death

$2,759,852- Catastrophic injury

$1,152,926- Malpractice

$1,000,000- Wrongful death

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Asset Protection- Why Everyone Needs Personal, Business, Estate and Asset Protection Planning  

Asset Protection

Why Everyone Needs Personal, Business, Estate and Asset Protection Planning

Smart decisions made prior to or early in a dispute can help you avoid a majority of all claims which expose your assets to collection.  We honestly believe that in the thousands of cases we handled over the past 21+ years, defendants could have avoided time-consuming and expensive litigation if they had simply sought the advice of experienced legal counsel before making an important personal or business decision.  When defending these people during litigation and trial, a great majority of our time is spent on “damage control” and minimizing the damages our clients could have easily avoided.

Getting good legal advice right off the bat is one of the most effective asset protection tools available.

In the time it takes to “snap” your fingers, you could lose everything.  It’s truly a shame that most people spend more time working on their golf game than they do their asset protection plan.

Did you know that during his or her lifetime, the average person will spend about 90,000 hours working hard to provide for his or her family and to accumulate wealth.  During this 45 year period of time, this same individual will spend less than an average of 3 hours planning and taking steps to protect his or her hard earned assets.  The truth of the matter is that more people spend time on the golf course working on their swing than they do planning their estate and protecting their assets.

The American Legal System-  Our lawyers enjoy the challenge of taking cases to trial and since 1986, we've litigated thousands of cases.  Without any reservation whatsoever, we believe and can comfortably report that our legal system is by far, the finest in the world.

Are there problems with our legal system?  Sure.  Do judges and juries always get it right?  No.  Do the high profile cases you read about in the paper with sensationalized ridiculous outcomes reflect what is really going on in our courtrooms across America?  Not even close.

There’s good reason why an “interesting” case makes the news or local paper.  It sells commercial time and newspapers.  Get rid of the well-publicized case with the unusual or unexpected outcome and when it is all said and done, we believe the checks and balances of our civil and criminal legal system are substantially better than any other system in the world.

That being said, how comfortable would you be facing a jury of your peers in a serious criminal case?  What about a civil trial with millions of dollars on the line?

Liability Insurance-  While most of us have liability insurance coverage, have you ever read the fine print in your insurance policy?  Big insurance is in the insurance game to make money.  To do this, insurance companies fill their policies with numerous exclusions all designed to minimize what benefits are eventually paid out.

One of our largest cases involved representing a client against his own insurance company.  Until we filed an insurance bad faith lawsuit and litigated the case for almost a year, the insurance company refused to pay its own insured benefits it owed under the terms and conditions of its policy.  While the case we handled eventually worked out extremely well for our client, more times than not, big insurance will maximize its exclusion and minimize its benefit payout.

Litigation Statistics-  In today’s world, statistics show that we will each be sued at least two to three times during our lifetime.  Business owners and professionals have a one in three chance of being sued during the next year alone.  A new lawsuit is filed almost every 30 seconds with nine out of ten lawsuits in the world being filed in the United States.

We tell our clients that it’s not a matter of IF you get sued, it's WHEN.  The real question is... What are you going to do about it?
 

Judgments, Debtor Examinations and More

Once a creditor’s claim against you becomes a judgment, it turns into a powerful collection weapon.  What follows are things you need to know about claims, lawsuits and judgments and why you need to set up an effective asset protection plan before a claim takes place.

Judgment-  In a civil case, a judgment is a legal court order telling a defendant in a lawsuit to pay money or do something.

Before a judgment can be obtained, a lawsuit must first be filed and served on the defendant.  Legal pleadings and discovery are exchanged between the lawyers and depending on the jurisdiction you are in (state or federal court), it could take several years before your case goes to a trial.  Some matters, such as contractual binding arbitration, are not even allowed to go to court but the same type of process takes place outside of court up to the final arbitration hearing date.  Both processes are extremely expensive.

Once a trial or arbitration takes place and a judgment or award is rendered against you, the judgment creditor will then file his judgment with the clerk of the court and unless it is paid, can start the debt collection process (attach your bank accounts, force the sale of your home, etc.).  If at all possible, you never want to let a claim develop all the want into a judgment.

If the judgment debtor files a notice of appeal and applies for a stay of execution, which in most cases also requires the posting of a bond (a percentage of the judgment), the judgment creditor will have to wait until the appeal process is completed.  It is noted that appeals are expensive and rarely successful.  The additional delay will probably only result in more attorney fees owned by the judgment debtor and more expense and interest owed to the judgment creditor.

Prejudgment Attachment- Generally speaking and as provided by the Due Process Clause of the Fourteenth Amendment, a creditor may not take property or money from a defendant until after a final judgment is entered.  In certain exceptions, a creditor may be able to file a lawsuit and present strong evidence allowing for pre-judgment attachment.  The creditor must normally post a bond and the process is normally expensive.

Default Judgments-  If you are sued by a plaintiff (creditor) and do not respond to the lawsuit in a timely fashion, the plaintiff can ask the court to enter a default judgment against you.  The default judgment has the same force and effect as a regular judgment after trial and the judgment creditor can immediately begin the collection process.  Never let this happen.  If you are served with a summons and complaint, contact your lawyer immediately.

Full Faith and Credit Clause, Treaties and the Comity of Nations-  Out-of-state judgments will have the same force and effect as a judgment entered against you in your own city and state.  If asked by a local attorney, the United States Constitution requires a court in California to enter a California judgment based upon an earlier Florida judgment.  Along the same lines, many countries have treaties with the U.S. or follow a concept known as the Comity of Nations which provides for the recognition of each other's judgments.  For example, a U.S. judgment would be recognized in England or France and visa versa.  [Note- many nations do not have such treaties with the U.S. or follow the Comity of Nations doctrine.  In fact, many established countries have legally and specifically enacted laws stating that U.S. judgments will not be recognized on their soil.  Foreign Asset Protection Trust can be established in these countries].

Judgment Liens-  After a judgment is obtained, a judgment creditor will then file an Notice of Abstract of Judgment with the recorder’s office in each county the defendant may have real or personal property in.  When real property is sold, a title search will reveal the lien and the sale will not be completed until the judgment has been paid.

Over the years, and after protecting our client’s rights by filing a judgment lien, we’ve received telephone calls from escrow agents asking us who we would like the check made out to.  When we represent creditors, we automatically file judgment liens in all possible counties right after a final judgment is entered.

Judgment Debtor Examinations-  After a judgment is rendered against you, the judgment creditor will normally force you (and third parties like your banker, financial planner…) to appear in court and answer questions about your finances and assets under oath.  You are required to provide honest and truthful responses to all questions.  If you lie, you can be found guilty of perjury which is a criminal offense punishable by jail.

The judgment creditor will also subpoena all of your personal, business and financial records.  This will include documents like bank statements, credit applications and loan documents.  Again, there are severe consequences if you fail to produce all the requested records.  It’s called contempt of court and can result in monetary sanctions and jail.

A good asset protection client looks forward to telling the truth during a judgment debtor examination because even if the judgment creditor finds out about a valuable asset, he will be unable to touch it.  That’s what we call effective asset protection!

Execution, Attachment and Levy-  Judgment creditors use these legal collection processes to take your personal and real property to satisfy their judgment.  Generally speaking, a creditor will take possession of your money or liquid assets.  He will take and sell your real or personal property.  A portion of your wages can be garnished.  In these processes, an official like the marshal or sheriff will be the person who physically takes and sells your money or property.  In the case of wage garnishment, your employer, subject to contempt of court sanctions, will be ordered to deduct a portion of your paycheck and pay the creditor.
 

What is a fraudulent conveyance?

“If someone threatens me with a claim or lawsuit, I’ll just transfer all my assets to my cousin Mike, and no one will be the wiser.”

“A judgment is no big deal.  I’ve already put all my assets in someone else’s name.”

If you transfer assets to avoid payment to a creditor, there is a very good chance that your transfer will be deemed a fraudulent conveyance and you will be sued.  The person you transferred assets to will also be sued.  A judge will order the earlier transfer void and the judgment creditor will get your assets.

Each state has a fraudulent conveyance or transfer law (in California see Civil Code §3439 and Penal Code §154).  A fraudulent conveyance is the transfer of assets to another person, without adequate consideration, with the purpose of “delaying, hindering or defeating” a creditor’s claim.  But how can a judgment creditor and court determine if a transfer of property has taken place and if so, is a fraudulent conveyance?

First of all, the judgment creditor will find out about the transfer either at the time of the judgment debtor examination or through easily available public records.  When reviewing whether or not the transfer constituted a fraudulent conveyance, the court will generally look at two different standards.

Actual Intent-  The first standard is “actual intent".  If you made a transfer with the intent of defrauding a creditor (or future creditor), the transfer will be voided.

Badges of Fraud-  Because “actual intent” is difficult for a creditor to prove, a second standard is that a creditor show the transfer taking place before or during a known or reasonably expected claim has one or more “Badges of Fraud”.  That is, "if it walks like a duck and quacks like a duck, it's probably a duck."

In court, the creditor has the burden of proving that a fraudulent conveyance took place.  The creditor can use one or more of the following “Badges of Fraud” in support of their fraudulent conveyance claim:

Insolvency- Transferring some or all of your assets leaving you in a financial position that you owe more than you’re worth is a “badge of fraud”.

No Consideration- Transferring assets without valid consideration is a “badge of fraud”.  [Note- an exception may exist if in return for transferring assets into a limited partnership or limited liability company, you receive partnership or membership interest].

Relationship Between Transferor and Transferee-  Transfer assets to a spouse or children or someone else you are close to is a “badge of fraud”.

Before or During Litigation- Transferring assets before a claim or after the filing of a lawsuit is a “badge of fraud”.

Secrecy and Concealment- Being sneaky or hiding assets is a “badge of fraud”.

Unusual Business Practices- Doing things contrary to normal business practices such as estate planning or reducing taxes is a “badge of fraud”.

Continued Use of Asset- Continuing to use or benefit from the asset after the transfer is a “badge of fraud”.

The key to success in an asset protection planning is to plan and implement your plan well before there is even a “hint” of a legal issue, problem or claim.
 

What Is Asset Protection?

Asset protection is a process of lawfully and ethically owning, managing and controlling personal and business assets to protect them from creditor attack.  It is an ongoing interdisciplinary effort which, depending on the unique needs of each individual client, may involve the application and conflict-of-law analysis of established and anticipated state, federal and international law, estate planning law, debtor-creditor law, real property law, contract law, bankruptcy law, corporate law, partnership law, trust law, family law, pension plan law, social security law, criminal law, civil procedure law, civil code law, evidence law, Medicare law and Medicaid law.

Proper asset protection planning should include lowering the asset profile of individuals and businesses to not only discourage frivolous lawsuits, but to also shield assets from criminal activity.  Effective asset protection planning will segregate and insulate assets from future liabilities and with proactive pre-litigation planning, will substantially minimize or reduce a client’s exposure to claims, lawsuits and judgments.  Because of the above-described complexity and, the very important attorney work-product and attorney-client privileges, qualified and experienced legal counsel is necessary to plan, implement and maintain on an ongoing basis, a lawful and effective asset protection plan.

As referenced above and evidenced by common sense, equity and a rapidly expanding line of court cases, a proper and effective asset protection plan should never be designed around secrecy, hiding assets, defrauding creditors, laundering money, avoiding the disclosure or reporting of income or, to evade taxes.  State and federal judges will not, and should not, tolerate fraudulent conduct.  Assets fraudulently transferred will be ordered returned and debtors failing to comply with the court’s order may very well be jailed for contempt.

Without disclosing all of our approaches to the general public, here is a partial list of commonly utilized asset protection tools which are normally combined together to solve the needs of our clients:

Revocable Trust (Living Trust) and Wills
Family Limited Partnerships
Ancillary Documents (pourover wills, powers of attorney, property agreements)
Irrevocable Life Insurance Trusts
Irrevocable Trusts
Intentionally Defective Grantor Trusts
International Asset Protection Trust and Entities
Domestic Asset Protection Trust and Entities
Gifting Trusts
Ancillary Documents (client portfolios, Crummey notifications, letters of instruction)
Exemption Planning
ERISA Retirement Plans
Pre and Post Marriage Property Title Agreements
Insurance
Charitable Remainder Trusts
Charitable Lead Trusts
Private Foundations
Testamentary Charitable Distributions
Ancillary Documents (client portfolios, letters of instruction)
Qualified Personal Residence Trusts
Grantor Retained Annuity Trusts and Unitrusts
Grantor Retained Income Trusts
Wills with and without tax planning
Ancillary documents
Conduit Trusts
Individual Special Needs Trusts
Joint Special Needs Trusts
Memo of Intent Guidelines
Retirement Trusts
IRA Master Beneficiary Designation
Qualified Plan Master Beneficiary Designation
Beneficiary Designation Inserts
FLLC formation documents
Funding and Transfer Documents

With the above in mind, the key to a legal and effective asset protection plan is to take proper action well before there is a claim.  To be proactive and take steps to plan and coordinate an effective estate and asset protection plan to protect your assets while you are alive, and to make sure your assets are properly transferred to your heirs after you are gone.

We are experienced attorneys who help clients understand, plan, implement and manage their asset protection plans.  In this article, we’ve shared our thoughts and concerns about the need for proper asset planning and protection.

Frankly, too many people contact us for the first time only after a claim has arisen or lawsuit filed.  By this time, it’s too late for effective asset protection planning (although depending on the nature and amount of the claim, there still may be several important things we can do to protect a majority of your assets).  Without exception, if these same people had contacted us before a claim or lawsuit occurred, we could have saved them a great deal of time, expense and mental anguish.

We are standing by to answer your questions and begin the process of protecting your family and business from future creditors.  Please give us a call.  It would be our pleasure to be of service.

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