Opinions Prejudgment Charging Order Attachment

Opinions On Prejudgment Relief

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

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2021.08.30 ... Charging Order Jurisdictional Issues In O’Neal

2021.07.30 ... U.S. District Judge Employs Common Sense To Overrule Glitch In Charging Order Statute In Brogdon

2021.06.17 ... Delaware Chancery Court Navigates Around Charging Order Exclusivity And Recognizes Reverse Veil-Piercing

2021.03.30 ... Some Random Musings About Single-Member LLCs Versus Multiple-Member LLCs

2021.03.27 ... Collateral Attack On Charging Order Via Federal Court Fails In Kerr

2021.02.21 ... Creditor’s Early Motion For A Receiver Gets The Kabosh In Medipro Case

2021.02.15 ... Debtor’s Large LLC Distribution To Circumvent Charging Order Draws Ire Of Non-Debtor Member In Bargreen

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More Articles On Charging Orders click here

For more on the historical background of Charging Orders and contemporary issues involving the same, see Jay Adkisson's article, Charging Orders: The Peculiar Mechanism, 61 South Dakota Law Review 440 (2016). Available at SSRN: https://ssrn.com/abstract=2928487

General Information

• About Jay Adkisson and this website
• Articles About Charging Orders

Analysis of Uniform Limited Liability Company Act Sections re Charging Orders

• Charging Orders (Section 503) contains the general charging order provisions.

• Foreclosure of Charging Order Liens (503(c-e)) deals with foreclosure generally of an interest subject to a charging order lien.
• Foreclosure re Single-Member LLC (503(f)) is the special case of foreclosure of an LLC with only one member.

• Transfers of Transferable Interests (Section 502) includes definitions of "transfer" (102(23)), "transferable interests" (102(24)), and "transferees" (102(25)) defines to what the charging order attaches.
• Definition of Distribution (Section 102(4)) specifies the economic right obtained through a charging order lien and/or foreclosure.

The Uniform Acts re Charging Orders and Transferable Interests (without Jay's comments):

• Uniform Limited Liability Company Act, Article V ("ULLCA" and "RULLCA").

• Uniform Partnership Act, Article V - ("UPA" and "RUPA")
• Uniform Limited Partnership Act, Article VII - ("ULPA" and "RULPA")

Effect of Bankruptcy On The Debtor-Member's LLC Interest here

Collected Court Opinions On Charging Orders here and below

Charging Order Example Sample Form

• Jay Adkisson - More about Jay D. Adkisson, background, books, articles, speaking appearances.

• Creditor-Debtor Law - An overview of judgment enforcement tools and their uses by creditors, and possible defenses by debtors. Related topics include:

• Voidable Transactions - Discussion of the Uniform Voidable Transactions Act (a/k/a 2014 Revision of the Uniform Fraudulent Transfers Act) and fraudulent transfer law in general.

• California Enforcement of Judgments Law - Considers the topic of judgment enforcement in California, including the California Enforcement of Judgments Law and other laws related to California creditor-debtor issues.

• Private Retirement Plans - An exploration of a unique creditor exemption allowed under California law which can be very beneficial but is often misused.

• Protected Series - An examination of the single most complex statutory legal structure yet created, with particular reference to the Uniform Protected Series Act of 2017.

• Asset Protection - The all-time best-selling book on asset protection planning by Jay Adkisson and Chris Riser.

• Anti-SLAPP Laws - A collection of and commentary about Anti-SLAPP laws and significant court decisions on the subject within the United States, and special focus on the California Anti-SLAPP law.

• Captive Insurance - Licensed insurance companies formed by the parent organization to handle the insurance and risk management needs of the business.

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