DIMINISHED PROTECTION FOR LLCs: FLORIDA SUPREME COURT RULING WEAKENS ASSET PROTECTION PROVIDED BY LLCs
By: Burt M. Romanoff
Florida limited liability companies are often utilized in Florida to operate on-going businesses as well as for estate planning and asset protection purposes. In its recent ruling, Olmstead v. Federal Trade Commission, the Florida Supreme Court held that judgment creditors may attempt to obtain an order from a court requiring an LLC owned by a single member to surrender its assets to the creditor in order to satisfy the debt of the single member. The ruling is a departure from current law, entitling the judgment creditor to obtain only a charging lien against a member's interest in the LLC (granting the judgment creditor only the right to the proceeds resulting from a distribution or disposition of a membership interest but no right to the day-to-day control of such interest property owned by the LLC).
To read more about this ruling, click on our link www.nhlslaw.com and choose the Articles page.
