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Offshore And "Other" Shore Asset Protection Trusts, Eric Henzy

Vanderbilt Journal of Transnational Law

The Portnoy, Brooks, and Lawrence cases demonstrate that under the right facts and circumstances, courts can and will enter orders finding spendthrift provisions of asset protection trusts invalid. These cases and this Article discuss a path that a bankruptcy court may follow to find that property transferred to an asset protection trust is property of a bankruptcy estate. Such a finding may lead to effective remedies for creditors, such as denial of a discharge to a debtor, orders compelling a debtor to direct a trust trustee to transfer assets, with contempt orders if the debtor fails to comply, and, possibly, …