Tate Mediator Talk – in a fire liability case counsel claims that assets held in the defendant decedent’s trust are not subject to the claims of the defendant decedent’s creditors

A hypothetical mediation scenario. A lawsuit arises from damages caused by a fire to a building. Soon after the fire one of the eventually named defendants dies due to natural causes – thus, that defendant and his estate and revocable trust were named as parties. A side note: pursuing claims against a decedent’s estate and trust are complicated areas of law and procedure – there are pitfalls to avoid and deadlines and procedures that must be met – these are complicated areas.

In any event, one of the attorneys asserts that the assets held in the decedent’s revocable trust are not subject to the claims of the decedent’s creditors. Counsel also asserts that decedent’s assets in his revocable trust could not be reached by creditors because the trust became irrevocable upon decedent’s death, and the trust also has a spendthrift clause. The assertions are incorrect. But the mediation is suspended. This would lead me to two comments: (1) present those types of assertions sufficiently before the mediation so that they are fully vetted before the mediation; and (2) it is counterproductive to make significant assertions that cannot then be verified or supported.

Regards, David Tate

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Best to you,

David Tate, Esq. (and inactive CPA)

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David Tate, Esq. (and inactive California CPA) – practicing only as an attorney in California.