Charging Order Prejudgment Relief

Topic Prejudgment_Relief TopicsPrejudgment

There is no provision in the Harmonized Acts for a pre-judgment attachment of the debtor/member's ("D/M's") interest, although other assets of a putative debtor are usually fair game for such relief. The exclusivity provision, § 503(h), might (wrongly) be construed to prohibit such pre-judgment relief.

Pre-judgment attachment of the putative D/M's interest should be allowed under the same circumstances that such attachment would be allowed against other assets of such a debtor. The court should also have the discretion to allow either the entity to retain pre-judgment distributions or have them paid into a court fund pending resolution of the merits of the case. However, the diversion of such distributions should be subject to § 503(g) which provides for exemptions.