Unique & Special Collections Roads Less Travelled

Transcription

1 Unique & Special Collections Roads Less Travelled Presented by: Barry Brooks Roye Randall Tex Ritter

2 Checking IRA Savings 401(k) TSP

3 NCP = Sole Account Owner Levy if no Probate

4 NCP = Decedent Claim Against Estate File Notice of Probate Claim

5 DP = Decedent CP & NCP = Heir/Claimant CP or NCP = Executor

6 NCP = Beneficiary/Executor Lien on NCP s Inheritance Lien Served on Executor File Claim for Relief & Lien

7 Creative Enforcement Remedies What to do with Trusts Probate Trusts Spendthrift Trusts Turnover Orders Foreclosure of Lien Alter Ego Self Employed Fraudulent Transfers JLPP (inventory, assets, accounts receivables)

8 Trusts When one or more persons for whose benefit an accumulation of income has been directed is or are destitute of other sufficient means of support or education, the proper court, upon application, may direct a suitable sum to be applied thereto out of the fund directed to be accumulated for the benefit of such person or persons. CA Civ. Code 726. Spendthrift Trust can be busted to support minor child

9 Trusts The judgment debtor's interest as a beneficiary of a trust is subject to enforcement of a money judgment only upon petition by a judgment creditor...the judgment debtor's interest in the trust may be applied to the satisfaction of the money judgment by such means as the court...determines are proper, including...sale of the judgment debtor's interest, collection of trust income, and liquidation and transfer of trust property by the trustee. CA Code of Civ. Pro (b)

10 Trusts If the beneficiary has the right under the trust to compel the trustee to pay income or principal for the benefit of the beneficiary, the court may...order the trustee to satisfy all or part of the support judgment... (d) This section applies to a support judgment notwithstanding any provision in the trust instrument. CA Probate Code (b)

11 Turnover Order Order to take property into possession then levy Turnover Order (may be ex parte) Seizure Order Sale; Let the levying officer handle (Sheriff)

12 Motion to Secure Payment or Appoint a Receiver File in child support action- A court has the authority to enforce its own orders. W.S When a court orders the deposit or delivery of money or other thing and the order is disobeyed, the court, besides punishing the disobedience as for contempt, may order the sheriff to take the money or thing and deposit or deliver it in conformity with the direction of the court. Child Support debts have priority over debts owed to other creditors. W.S , ,

13 Alter Ego CA CCP 187 When jurisdiction is, by the Constitution or this Code, or by any other statute, conferred on a Court or judicial officer, all the means necessary to carry it into effect are also given; and in the exercise of this jurisdiction, if the course of proceeding be not specifically pointed out by this Code or the statute, any suitable process or mode of proceeding may be adopted which may appear most conformable to the spirit of this Code.

14 Alter Ego A trial court has the authority to amend a judgment in order to add additional judgment debtors. Code of Civil Procedure section 187 Dow Jones Co., Inc. v. Gerard Avenel and Avenel Imports, Ltd., 151 Cal. App. 3d 144 (1984)

15 Pending Lawsuits and Probate Notice of Lien Probate request for special notice Collections against Insurance Proceeds Worker s Comp case, obtain collection beyond lien amount

16 Personal Injury Medical Expenses Priority of Child Support Lien Attorney Fees Uninsured Motorist

17 Life NCP is Beneficiary NCP is Owner

18 Wrongful Death vs. Survivor

19 Other Actions Drug Asset Seizure/Asset Forfeiture Actions Annuity cash-out. Petition court Insurance Proceeds Structured Settlement attachments.

20 QUALIFIED DOMESTIC RELATIONS ORDERS QDROS Roye Randall Staff Attorney County of Los Angeles

21 History: Then and Now Prior to 1974 Private pension plans were not regulated by the federal government 1974 Implementation of Employee Retirement Income Security Act Anti-Alienation Clause of ERISA Benefits cannot be assigned or alienated [29 USC 1056(d)(1)]

22 History: Then and Now State divorce law developments Pension rights earned or acquired during marriage were marital or community property 1984 Retirement Equity Act (REA) P.L (1984)

23 History: Then and Now 1984 Retirement Equity Act (REA) Amended Key Sections of ERISA & Internal Revenue Code Certain orders entered in state domestic relations cases must be accepted & honored by ERISA qualified pension plans REA specifies the required characteristics of a QDRO Under REA, QDRO is expressly exempted from the anti-assignment and alienation clause of 1056(d)(1) of ERISA

24 The Requirements in a Nutshell The Four Do s To become a QDRO, the DRO must contain: 1. Name and last known mailing address of Participant and Alternate Payee; 2. The name of the plan to which the order relates. 3. Amount or percentage of P s benefit to be paid to AP, or manner in which the amount or percentage is to be determined. 4. The number of payments or period to which the order applies.

25 The Requirements in a Nutshell The Four Don'ts The DRO must not require the plan to: 1. Provide any type or form of benefit or option not otherwise provided under the plan 2. Pay a joint and survivor annuity to the alternate payee and his or her subsequent spouse. 3. Provide increased benefits (determined actuarially). 4. Pay benefits that are assigned to another alternate payee under a prior QDRO.

26 The Requirements in a Nutshell Who can be an Alternate Payee? Spouse Former Spouse Child Other dependent All of these relate to the participant

27 Defined Benefit or Defined Contribution? Defined Benefit Plans Participant s contribution is unknown Monthly or annual benefit derived by formula at retirement age Useful for ongoing monthly current support obligation Cannot exceed Participant s monthly benefit

28 Defined Benefit or Defined Contribution? Defined Contribution Plans [Profit Sharing, 401(k)] Otherwise known as account balance plan Divide account balance either by percentage or amount Primarily dependent on plan provisions Excellent for use on with arrears collection

29 First things First Obtain the three key plan documents: The Summary Plan Description The Annual Benefits Statement The Plan s Written QDRO Procedures If available: Sample of Plan Approved QDRO

30 Step by Step Guide Step 1 Obtain the key items of information Step 2 Request the plan documents Step 3 Read the plan documents Step 4 Read the QDRO procedures

31 Step by Step Guide Step 5 Review the sample QDRO Step 6 Draft the QDRO Step 7 Submit QDRO to Plan legal department for review and approval Step 8 Make changes; re-submit if necessary Step 9 Once approved, set OSC for QDRO approval by court

32 When should you use a QDRO? The Participant is already retired and receiving payments from the plan (in pay status) The Participant is currently unemployed but has pension rights from previous employment The Participant has evaded previous enforcement efforts Most or all of a Participant s assets are located in another state

33 Final Thoughts QDROs are a useful enforcement tool Communicate with the Plan Legal Department Be creative with your non-paying cases Refer to suggested websites for more information Feel free to contact me: Roye_Randall@cssd.lacounty.gov (310)

34 Sale or ReFi Tax Sale HOMESTEAD ALERT Excess Proceeds Condemnation

35 Foreclosure on Real Property File an Abstract of Support Judgment Notice in writing pursuant to a Writ of Execution (120 Notice requirement for real property that is a dwelling). Exemptions Requires a court order for sale Preliminary Title Report Legal Description Appraisal Instructions Order for Sale of Real Property Excess Proceeds payable to creditors on a first in time basis even if you are not the foreclosing creditor.

36 Contempt Every court shall have the power to do all of the following: to compel obedience to its judgments, orders and process and to the orders of a judge out of court, in an action or proceeding pending therein

37 The End