Enforcement of Spendthrift Trust Clause Upheld

On May 31, 2013, the Florida Fifth Circuit Court of Appeals issued it decision in the case of Zlatkis v. All America Team Concepts, LLC  upheld the validity and enforcement of spendthrift trusts. In this case, a judgement holder attempted to enforce its judgment against the debtor's interest in a spendthrift trust.

The Court explained that spendthrift trusts are created with the intention of providing a fund for the maintenance of another and at the same time securing it against the person's own improvidence or incapacity for self-protection.  Croom v. Ocala Plumbing & Elec. Co., 57 So. 243, 244 (Fla. 1911). The Court further explained that a valid spendthrift clause prevents the beneficiary of the trust from transferring his interest in the trust as well as prevents creditors from reaching any of the trust's funds until they are dispersed to the trust beneficiary.  It further noted that spendthrift provision have long been recognized as valid under Florida common law and that sections Florida Statutes sections 736.0501 - 736.0507 additionally provide for the enforcement of spendthrift trusts.

(305) 891-4055 - Jordan E. Bublick is a Miami Bankruptcy Lawyer with over 25 years of experience in filing Chapter 13 and Chapter 7 Bankrkuptcy Cases.