Do you know whether an asset has an enforceable restriction on transfer that excludes it from the estate?
He listed the clients’ state retirement plan and their Post Office Thrift Savings Plans as assets of the estate and used an exemption to protect them. Twasn’t necessary: according to the Supremes, the anti alienation clause in group retirement plans like these is a restriction on transfer sufficient to exclude the retirement plan from the estate.
Pop quiz: Can you think of another asset subject to a restriction on transfer? See the bottom of the post for the answer.
If property isn’t property of the estate, it is not available for administration by the trustee and therefore it isn’t necessary to exempt it. Exemptions are used to pull property out of the property of the estate for the exclusive use of the debtor. If it wasn’t in the estate, you don’t need to get it out.
The fault, dear reader, is not in our stars, but in ourselves.
With apologies to Shakespeare, it seems clear that the failure to grasp what a seasoned practitioner knows reflexively is not happenstance. Rather, it is the lack of solid foundational knowledge in the bankruptcy bar. A well-trained consumer bankruptcy lawyer uses the Patterson analysis every day. It becomes second nature after you’ve been practicing awhile, engrained in your thought processes to the extent that you may not even realize you’re doing it.
The problem is there are few reliable resources from which to gain the foundational training necessary to adequately represent consumer debtor clients. There are books, to be sure; but books are mere words on a page, and lack the resonance of the real world. Conventions and CLE events are more helpful but they come infrequently, and with a heavy price tag in terms of time and money.
If you want to protect your clients (not to mention your license to practice law) there’s no substitute for comprehensive training.
After much thought and preparation, I’ve come up with a training system that prepares attorneys to practice consumer bankruptcy law without the massive outlay of time and money. A system that draws on my years of experience representing debtors at the highest level. And a system that is easily accessible.
I’m releasing this novel program, designed solely for the lawyer who is serious about representing consumer debtors properly, in the coming days. You can watch for more details here on this site. And though I’m not prepared to speak at length about it today, I can tell you:
- It will provide a roadmap for properly assessing a consumer debtor’s Chapter 7 or Chapter 13 bankruptcy eligibility;
- It will be accessible 24/7/365 online via video tutorials;
- It will be easy to understand;
- It will be immediately actionable; and
- It will be comprehensive.
If you get this blog delivered to you by email or have signed up for my free Ecourse, you will get details in your email box the moment it’s ready for you. So I encourage everyone to sign up for the email updates at the very least. This will ensure that you don’t miss the boat.
The answer to our question posed above is “spendthrift trust.”