Now is the Time for Asset Protection Planning

Posted on March 23, 2011 by Ken Laino

Many things in my law practice run in spurts -- just like things in our daily lives.  I may go a whole year without having a client buy or sell a business, and then several clients are engaged in business sales all at once.

This past month I have a had a disproportionate number of inquiries from people across the country who are asking about asset protection options after they have had a lawsuit filed against them -- and even after a large judgment has been entered.  About a week ago I spoke to someone who had lost a court case; a judgment had been entered against him; he had appealed; and then he had lost the appeal.  Now he was thinking about protecting his assets.  Guess what?  I was not able to offer any good options for him.

There are situations in which certain legitimate asset protection alternatives could still be available to someone with a judgment against them.  But your options decline drastically once you are sued.

As I have mentioned many times before, the time for asset protection planning is right now, before any problems arise.

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Crisis in Japan -- Another Grim Reminder of the Need for Asset Protection Planning

Posted on March 21, 2011 by Ken Laino

Asset protection planning is usually triggered by fear of a catastrophic lawsuit.  Most of the clients I work for -- especially physicians, closely held business owners and high net worth individuals -- are concerned that a single lawsuit could wipe out everything they have.  And this concern is entirely justified.  It is silly not to protect your assets within the bounds of applicable laws.

But lawsuits are not the only reason for asset protection planning.  Totally unexpected catastrophes -- anything from natural disasters, a stock market crash, or other economic crisis -- can also suddenly expose many of your assets to creditors.  For example, a catastrophic loss of real estate or other property that is not covered by insurance could suddenly put all your other assets at risk.  Asset protection planning -- done in advance of such a catastrophe -- could insulate your other assets from the reach of creditors.

The recent events in Japan -- an earthquake, followed by a tsunami, followed by nuclear power plant disasters, followed by all the economic fallout from these unanticipated disasters -- remind us that everything can change in a moment.  You generally cannot lawfully transfer assets once disaster strikes.  Such a transfer would usually be a voidable fraudulent conveyance.

It is difficult to focus on disaster planning when no particular disaster is staring you in the face.  But that is exactly the right time for the most flexible and effective asset protection planning. 

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