A Colorado client/defendant had his move to Florida stymied by his creditors. The story is an example of how not to move to Florida.The defendant owned a house and financial accounts in Colorado where a lawsuit against him is pending. No judgment has been entered. The defendant purchased a house in Florida and moved into the Florida house. The Colorado house was put on the market. The creditor found out the client had moved into his Florida homestead.
Even though there was no money judgment against the defendant, the creditor filed a petition with the Colorado court to freeze the defendant’s Colorado assets. The court issued an order freezing his financial accounts in Colorado and his Colorado house. The creditor also asked the court to appoint a receiver over the defendant, personally, and all his property whether located in Colorado or Florida.
This is the second time this year I have seen a creditor in another state create a receivership over a Florida resident. I have talked to several Florida attorneys about this issue, none of whom believe a Florida court will enforce a foreign receivership. Yet, the client still faces possible contempt of court if he does not appear in Colorado in his receivership case, and enforcement in Florida is undecided.
This example shows that moving to Florida has pitfalls if not done properly. Residents of other states should first liquidate or encumber real property in their home state before buying a Florida homestead. Financial accounts should be liquidated and moved to Florida before announcing change in residency. Creditors know it is difficult to collect unsecured judgments in Florida, and they will take aggressive measures to stop a debtor from leaving the state where litigation is pending.
About the Author
Jon Alper is an expert in asset protection planning for individuals and small businesses.
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