SEPTEMBEROCTOBER 1998
While the efficacy of asset protection trusts has been questioned, they can protect the bulk of the trust's assets from creditors, even when challenged.
The word "work" is defined by reference to where a particular APP client would have landed had he not earlier engaged in APP.
Even under difficult circumstances, the APT still caused tremendous headaches for the creditor and ultimately resulted in a settlement for less than the full amount owed,
A creditor's cause of action (as defined under Act Section 13B(8)(b)) accrues on the date a verdict enters, which is the first act which "gave rise to the judgment itself.
The bankruptcy court looked at local law, not Belize law, in determining whether the offshore trust assets were includable in the debtor's bankruptcy estate.
In Portnoy, the debtor misled the creditor during settlement negotiations, purporting to have insufficient assets and insufficient income to satisfy the guaranty.
While the debtor did not receive his discharge in bankruptcy, neither was the creditor able to access the assets held in the APT.
The ultimate safety valve afforded by a foreign situs APT is the ability the trustees have to diversify assets out of the jurisdiction of the U.S. courts.
In a 1993 article entitled "Asset Protection Planning and Fear of Flying"' the author predicted that over the course of time a certain number of offshore asset protection plans would be attacked by claimants, and that a certain percentage of these attacks would produce less than favorable results for the planning structures involved. This prediction has proven to be accurate.
Because of these attacks, some wealth planners and their clients have become concerned about the efficacy of asset protection trusts (APTs), whether domiciled offshore or in one of the few states in the U.S. that has recently enacted asset protection trust-style legislation. Should they be concerned? At the risk of sounding too vague, the answer is "it depends.
Offshore Trust Bashing
Adding to the discussion over the efficacy of APTs, Forbes magazine ran an article in its June 15, 1998 issue entitled "Your Trust Has a Hole." The article itself could lead the uninitiated to believe that APTs and even asset protection planning (APP) itself do not "work."To prove the article's thesis that creditors are finding ways to access APT assets, the author of the Forbes article notes a "Miami attorney ... who specializes in the field... admits that several of his clients have paid as much as 18 cents on the dollar to settle claims against their offshore trusts." (Emphasis added). However, does not the attorney's "admission" indicate that those particular foreign situs APTs in fact "worked?" Could not the same be said of the "ten" trusts claimed in the article to have been pursued because they forced discounts of 40% and more?
The Many Definitions of Success
It must First be acknowledged that the word "work" is defined by reference to where a particular APP client would have landed had he not earlier engaged in APP. As has been this author's view for over a decade, the ultimate goal of APP is realized if the client weathers a legal storm at least moderately better than he otherwise would have in the absence of any planning. The experiences to date of the author have, however, far surpassed this standard.
Variables Determine Success of APP
The many variables that exist under any given plan prevent one, in all fairness, from making blanket statements like "APTs work" or"APTs do not work." These many variables applicable to an APT and to APP in general, include:
1. The facts peculiar to a given client's situation.
2. The client's goals.
3. The manner and extent to which the client's goals are or can be incorporated into the design of the APT.
4. The skill with which the APT was crafted.
5. The nature of the asset or assets transferred to the APT.
6. The skill with which the APT is attacked.
7. The skill with which the APT is defended.
8. The thoroughness and protectiveness of the APT's applicable law.
9. Whether the opposing party is a governmental agency.
10. Whether any criminal sanctions would result from the trustees (or others involved) exercising certain options they would otherwise be free to exercise if the litigants were all private parties.
11. The law of the forum court.
12. Any biases or the bent of the presiding judge.
APTs have achieved the ultimate goal of protecting the subject assets even when variable 1. above was not particularly favorable. As noted by one U.S. litigator— who had the unenviable task of defending the interests of an APT that was settled by an individual who happened to be less solvent than he in fact thought he was — "the case I had involving an APT convinced me that these are very effective tools. Even under the most unfortunate and difficult circumstances, the APT still caused tremendous headaches for the creditor and ultimately resulted in a settlement for less than the full amount ... owed [which] I consider ... to be a substantial benefit for [the APP client]."
To the extent a battle over the APT's assets is forced into the courts of the country whose law is designated as the APT's applicable law, the risks attendant to variables II. and 12. above, which are among the most dangerous, are either reduced or eliminated altogether.
What the Reported Cases Say
The Forbes article and some members of the planning community point to a number of reported cases that — to them — indicate APTs can be "cracked open." As will be seen, however, these cases contain no surprises.
1. Orange Grove. In a case of first impression before the High Court of the Cook Islands, 515 S. Orange Grove Owners Ass'n v. Orange Grove Partners, Plaint No. 208/94 (High Ct. Rarotonga. Civil Division, Nov. 6, 1995), the High Court interpreted Section 13B of the Cook Islands' International Trusts Act of 1984, as amended (the Act). However, the case involved interlocutory proceedings and was not a decision on the merits.
In 1988 and 1989, respondents (the Developers) sold condominiums they had developed to the appellants (the Association). Defects were later discovered in the condominiums and redress was demanded in 1991. Suit was brought on the demands in 1992 in California Superior Court, and a judgment in excess of $5 million was entered on April 13, 1994, in favor of the Association and against the Developers.
Beginning in December 1993 and continuing up until the month in which the California judgment was entered, the Developers created a Cook Islands International Trust and began the process of transferring all, or substantially all of their property to a structure which included the Trust. In December 1994, the Association began proceedings in the Cook Islands to recover the amount of the judgment they had obtained in the California action, applying for a Mareva injunction to restrain certain of the Developers from removing the administration of the trust and any property from the jurisdiction of the Cook Islands. A temporary Mareva injunction was issued, but was set aside in March of 1995 for not having "been brought in time." In May 1995, leave to appeal to the High Court was given in respect of vacating the Mareva, pending the determination on appeal. On appeal, the High Court found that:
1. The statute of limitations provisions of Subsections 13K(l)and (2) of the Act did not apply to the case, for they only relate to efforts to set aside or annul an International Trust or transfers thereto. In Orange Grove the Association was "seeking only a judgment for the amount awarded to the appellants in the California Court with interest and costs and with a declaration that the [Cook Islands trust company] satisfy that judgment out of the [subject International Trust]."
2. For purposes of Act Section 13B(3)(a), a creditor's cause of action (as defined under Act Section 13B(8)(b)) accrues on the date a verdict enters, which the High Court determined is the First act which "gave rise to the judgment itself." Hence, the Mareva was reinstated, and the Association was free to proceed against the subject International Trust. In its decision the court ignored Act Section 13B(4), which states that a disposition shall not be fraudulent if it takes place before the creditor's cause of action accrues.
Once it was determined that the Association was free to go forward with its substantive proceedings, then —to prevail in any action against the subject trust — the Association was faced with having to satisfy the requirements of Section 13B(1). That is, the Association was faced with having to prove beyond reasonable doubt that:
1. The trust was settled and funded with the principal intent to defraud a creditor.
2. The funding of the trust left the settlors thereof insolvent.
The author has been advised that this case subsequently settled, and only a portion of the trust's assets were used in the course of the settlement.
The 1996 Amendments to the Cook Islands International Trust Act 1984, inter alia, clarify the issue that this decision raises concerning the "first act which gives rise to the judgment itself." As such, the court's strained reasoning, which is perhaps illustrative of the old adage that "bad facts make bad law," is no longer a risk for Cook Islands International Trusts.
2. Brown. Brown vs. Higashi, No. 95-3072 (Bankr. DC Alaska, 1996), concerns a debtor who was apparently using the APT he settled solely for the purpose of hinder-ing and delaying creditors, and involves an action by a judgment creditor against a debtor to determine the validity of one of his offshore trusts created under the law of Belize. The case considered whether the assets in the offshore trust were includable in the debtor's bankruptcy estate. The bankruptcy court looked at local law to make this determination, notwithstanding that the trust was to be interpreted and administered under Belize law. The court ruled that the transfers made to the trust were with the intent to hinder, delay, or defraud creditors, and were therefore void. The court cited a number offacts that caused it to reach the conclusion that the trust was created merely as a vehicle to defraud creditors, including:
• The failure of both the "creator" and the trustee of the trust to execute any trust documents.
• The debtor's retention of direct control over the trust assets.
• The lack of evidence supporting any credible purpose for which the trust was formed, other than defrauding creditors.
From conversations with legal counsel for Brown, the author understands that Brown had brokerage statements sent to himself for brokerage accounts purportedly owned by the trust, and that when Brown contacted the trustee in Belize Five years after the trust was supposedly settled, the trustee had no record or recollection of the trust. The court concluded that the entire trust was simply a sham. Consequently, the assets of the trust were ruled by the court to be part of Brown's bankruptcy estate.
3. Portnoy: In re Portnoy, 201 Bkrptcy. Rptr. 685, 1996 Bankr. LEXIS 1392, involved a bankruptcy debtor's motion for summary judgment on his discharge from bankruptcy. In the words of the bankruptcy court, the debtor (Portnoy") transferred virtually all of his assets into an irrevocable offshore trust in Jersey, Channel Islands "at a time when he knew his personal guarantee ... was about to be called." Thereafter, Portnoy's obligations under the guaranty became the subject of a lawsuit against him.
The bankruptcy court noted that Portnoy created the trust after he entered into the guaranty. Portnoy also named himself as the "Principal Beneficiary" of the trust. In this case, the facts also reflect that Portnoy misled the creditor during settlement negotiations, purporting to have insufficient assets and insufficient income to satisfy the guaranty. Portnoy did not even disclose the existence of the Jersey trust until he was deposed by the creditor, subsequent, of course, to his bankruptcy filing. At that time, he also disclosed for the first time that he was depositing all his salary payments into an account under his wife's name. The court cited numerous other occasions where Portnoy and his wife were not truthful or credible in their assertions. These facts were viewed by the court as all being indicia of Portnoy intentionally attempting to hinder and delay his creditors.
In light of these facts, the court refused to grant Portnoy his motion for summary judgment. Unfortunately, the court does not discuss how the creditor would ever gain access to the assets held in the offshore trust, or whether Portnoy was to be denied his bankruptcy discharge. The court held only that Portnoy's motion for summary judgment on the discharge issue was denied. The egregious facts of this case, however, may facilitate the creditor's ability to recover the assets held in the Jersey trust in the event the creditor were to pursue his recourse in a Jersey Court. The States of Jersey Royal Court shows no record of proceedings ever having been brought in Jersey against the trust.
4. Grupo Torras. Grupo Torras S.A. v. S.F.M. Al-Sabah, Chemical Bank & Trust (Bahamas) and Private Trust Corp., (Sup. Ct. of the Bahamas Sept. 1, 1995), involved Kuwaiti Sheikh Fahad who obtained assets through illegal means and then transferred those assets to Bahamian trusts. The plaintiffs sought to set aside the transfers to these trusts. The Bahamian Supreme Court emphasized that the protections to a settlor made available through the use of Bahamian trusts would not apply to assets that the settlor did not legitimately own at the time of transfer to the trust. In interlocutory proceedings (and not a final judgment on the merits of the case) the court applied a long-standing principle of English law that a settlor must have good title to assets before he can transfer title to trustees of a trust.
5. Colbum: At issue in In re Colbum, 145 Bkrptcy. Rptr. 851 (Bkrptcy. DC Va., 1992) was whether the debtor Colbum should be granted his discharge in bankruptcy. Among other things, Colbum omitted to list on his bankruptcy disclosure forms a ten-year reversionary interest he had under a Bermuda APT. The APT held all of the issued and outstanding shares of a corporation by the name of Malibu Capital Corporation. It was immaterial to the bankruptcy court that the debtor had APP goals in mind when he settled the trust. Moreover, the court did not rule that under the particular structure used, the assets of the APT were to be included in the debtor's bankruptcy estate.
In denying the debtor's bankruptcy discharge, the court stated, in pertinent part, as follows:
"In 1987, [the debtor] retained a Washington D.C. attorney ... to set up the Prince Trust as an offshore trust under the laws of Bermuda. Tr. at 128. According to [the attorney], one of the purposes of the Trust was to 'divest the settlor of sufficient ownership of the trust principal and later the accumulating income so as to defeat any future creditors of the settlor without transferring away the settlor's ability to benefit from the fruits of trust principal at some future date.' Tr. at 132. The debtor was the settlor of the Prince Trust. Tr. at 162. A trustee of the Prince Trust was Bermuda Trust Company, Ltd., a subsidiary of the Bank of Bermuda. Tr. at 155; 158. The debtor held the position of 'First Chair' of the Prince Trust Committee of Trust Protectors which is an advisory board that has the ability to transmit advice to the trustee. Tr. at 137.
"Based on ... evidence, we conclude that the Debtor knew of his reversionary interest at the time he prepared his Schedules and Statement of Affairs, but chose to conceal such interest.... In light of the pattern of omissions and the inconsistencies in his testimony, we conclude that the Debtor concealed his residual interest with intent to at least hinder or delay his creditors.
"Peoples Bank also contends that the assets of the Prince Trust belonged to the Debtor at the time of the filing of his petition and because the Debtor failed to disclose such assets the Debtor should be denied a discharge pursuant to Section 727(a)(2) [of the Bankruptcy Code]. However, Peoples Bank has failed to prove that such assets were property of the Debtor of his estate. Peoples Bank did not introduce any evidence that the creation of the Prince Trust or the Debtor's transfer of assets to the Prince Trust was in any way defective or that, under any other theory, the Debtor has any interests in the assets of the Prince Trust other than his reversionary interest."
From a private discussion with the Washington D.C. (now London) lawyer mentioned above, the author understands that while Colbum did not receive his discharge in bankruptcy, neither was the creditor able to access the assets held in the APT. Following the proceedings, the settlor's obligation — which was due and owing the creditor — was satisfied in full for a hefty discount in a private settlement between the creditor and the trust.
6. Brooks: In re Brooks, 1998 Bankr. LEXIS 60 (January 26, 1998), involved a trust the bankruptcy court determined to be a self-settled trust. Accordingly, it held the spendthrift provisions in the trust to be invalid. As a result, the assets of the trust were included by the court in the debtor's bankruptcy estate.
In this case, the debtor transferred stock to his wife, who in turn contributed those shares, along with $50,000 of her own funds, to offshore trusts in Bermuda and Jersey. The debtor was the primary beneficiary of these trusts. The debtor had the right to receive all earned income, and the trustee had broad discretion to distribute principal from the trusts to the debtor.
The debtor argued that the trusts were not self-settled because his wife settled the trusts. The bankruptcy court still viewed the debtor as the settlor because he was the source of the assets used to fund a substantial portion of the trusts. The debtor also argued that even if the trusts were self-settled, the Bermuda and Jersey laws determine the enforceablity of the spendthrift provisions in the trusts. The bankruptcy court held that under Connecticut conflict of law principles, the law of the settlor's domicile was to be used, and not the law designated by the settlor. In applying Connecticut law, the court declared the trust invalid as to the creditors of the debtor.
Brooks does not state or otherwise indicate whether any funds were ultimately recovered from the foreign trustee. Further, crucial to the Brooks holding was the design of the particular trust — one the author would not be comfortable using or recommending when asset protection is a primary goal. The trust in Brooks was not a discretionary trust, and required the distribution of all income to the debtor. The debtor was also the primary beneficiary with respect to distributions of trust principal.
Also crucial to Brooks were the unique choice-of-law principles embodied in Connecticut law. Most states do not have a Connecticut-type rule; instead, the general rule followed is that the settlor is free to choose the applicable law.
Given the court's analysis, its decision would likely have been the same whether foreign law or another state's more protective law (e.g., Alaska or Delaware) was designated by the settlor. The ultimate safety valve afforded by a foreign situs APT is the ability the trustees have to diversify assets out of the jurisdiction of the U.S. courts, and to force the battle into the foreign court. For this reason, Brooks underscores the importance of going offshore and highlights one of the many problems with using domestic trust law for APT purposes. Stated another way, in the author's view the real danger with the Brooks holding is for those who rely on the U.S. domestic trust system for asset protection.
7. Anderson. Anderson is unfolding as this article goes to press. At the time of this writing, Denyse and Michael Anderson, a San Diego couple, are sitting in a Las Vegas, Nevada jail on federal contempt charges for failure to repatriate trust assets.
While it may be a surprise to the reader, based on the author's knowledge of the facts, the result of this case appears entirely consistent with contempt law. Although proper asset protection structures are designed to take contempt law into consideration, it does not appear that this was true with the APT settled by the Andersons.
Contempt law in the U.S. is quite clear — one cannot be held in contempt of court for failing to produce that which is impossible to produce. This "impossibility of performance" defense is a complete defense to a charge of contempt of court. An exception to the impossibility of performance defense is the "self-created impossibility." However, for this exception to apply, there must be a nexus in time between what one does to create the impossibility and the order as issued by the court.
Most unfortunately for the Andersons, the nexus in time between what was done to create the impossibility and the order of the court indeed clearly existed. First, the Andersons were trustees of the trust they settled (not a design the author would suggest or use). Second, the Andersons apparently remained as trustees throughout the litigation (not an approach the author would advise). Third, the Andersons remained trustees even while the judge ordered them to repatriate the assets (not good). Thereafter, the Andersons notified the foreign trustee of their legal difficulties with the U.S. government and their situation of duress (bad timing). This resulted in the foreign trustee removing the Andersons as trustees and the Andersons' becoming incapable of repatriating the assets.
Is it any surprise that the Andersons were jailed for contempt of court? Is it any surprise that the self-created impossibility exception to the impossibility of performance defense applied? After all, the Andersons had the power to repatriate the subject funds as of the time of the court's order, and only lost that power when they advised the foreign trustee of their duress after the court's order had entered.
The reader may be interested in some language from a transcript of 1995 Contempt Proceedings involving a client of the author's Firm and the planning structure created by the client. Therein, the judge states:
"I've reviewed the law regarding contempt and the standards that are required for me to hold Mr. [X] in contempt. That standard is clear and convincing proof, which means something more than preponderance of the evidence but something less than absolute certainty.
"One thing I've learned a long time ago as a judge, you never order something you can't enforce. And if we order him to pay a million dollars, I have to be assured that's a reasonable order. As a matter of fact, contempt law says that one should not issue orders that cannot be complied with. It's a violation of due process to issue orders that the respondent cannot comply with.
"I'd look pretty silly if I entered orders that couldn't be enforced.
"There's case law to the effect that if we issue a compliance order that the respondent does not have the ability to comply with, that's punishment and violation of due process.
"By putting him in prison, that doesn't compel compliance, because he does not have the ability, apparently, to comply."
These principles of U.S. contempt law were confirmed by a room full of judges when the author had the privilege to address the National Judicial College in Reno, Nevada a few years ago.
While there is little a planner can do to protect a client from a "judge gone mad," there is a lot a planner can do to protect a client against an improper plan design, or to at least advise a client about the risks associated with incorporating unprotective plan design features, which the client may for some reason wish to use in the overall plan.
What the Unreported Cases Say
The seven cases summarized above are interesting and important to those with an asset protection planning practice, even though they pose no particular surprise under their respective facts. What is likely more interesting, however, are the many challenges by claimants that are forced into discounted settlements by the APT and hence are not reported.
Over the course of time, about 50 plans of the author's firm have come under attack by an adverse party. This represents approximately 5% of total plans prepared by the author's firm over the past decade — not that high a percentage of challenges considering the wealth profile of the typical APT client. In all cases but one, the client weathered the storm in substantially better shape than he would have in the absence of any planning, far surpassing the author's own "moderately better" standard.
Some of the more interesting unreported challenges with which the author has been involved are summarized below:
1. Mr. and Mrs. A sold the family business for a large sum of money. Promptly following the sale, they settled their net sales proceeds in an APT. A few years later, the business that was sold Filed for bankruptcy. The bankruptcy trustee filed an action against Mr. and Mrs. A as the sellers, on a reverse fraudulent transfer theory by which the trustee sought to recover the gross sales proceeds received by Mr. and Mrs. A. Shortly after he was informed of the planning that was undertaken several years earlier, the claim of the bankruptcy trustee was settled for less than 1.5 cents on the dollar.2. Mr. B was a real estate investor. Knowing the many perils of the real estate market, he protected as much of his estate as was appropriate at the time, given his various liquidated and contingent guaranties. Several years later Mr. B suffered a judgment as a coguarantor. Unfortunately for Mr. B, the other guarantors had been forced into bankruptcy due to other real estate deals in which they were involved, making him the focus of a collection effort by a very large creditor and its law firm. Fortunately for Mr. B, he had earlier protected his estate through an APT. Even though his planning structure held approximately one-half of its assets in Mr. B's home state and the balance overseas, and even though the adversaries were fully informed as to the APT's holdings, the judgment against Mr. B was satisfied in full for less than 5 cents on the dollar.
3. Dr. C was an uninsured practicing physician. Within months of Dr. G's APT being funded, his attorney informed the author's firm that Dr. G had recently and unexpectedly been named as one of several defendants in a nuisance suit alleging that Dr. C and a host of others had committed malpractice. The attorney stated he had advised the plaintiffs legal counsel that Dr. C's assets had been protected, and a token settlement offer was extended. After confirming that Dr. C's assets were indeed protected and that Dr. C was uninsured, the plaintiff accepted the settlement offer. The plaintiff continued to pursue the claim, but only against the other named defendants.
4. Mr. D is an individual who, as the owner of vast real estate holdings, had a general concern with the potential of a toxic waste problem with one of his holdings. He had no reason to believe this was true, and otherwise did not know whether any of his properties were in fact contaminated. Some time subsequent to his planning being completed Mr. D's wife filed divorce proceedings. A property settlement was reached which, according to Mr. D's counsel, was substantially more favorable than that which would have resulted had Mr. D not implemented his planning.
5. Mr. E is an entrepreneur who had a penchant for deal-making. His successful track record, however, was marred by a general partnership with which he was involved and which had incurred a substantial liability. Mr. E not only lost most of his hard-earned wealth, but he lost his drive and ambition as well since he knew his future successes would only serve to fund his prior failure. By diverting future business opportunities to an APT prior to their ripening into assets and thus avoiding any fraudulent conveyance issues, he was able to control future business undertakings in his capacity as president of a company underlying the APT, and to accumulate new wealth free of his past problems. The new wealth accumulated in the APT remained protected and Mr. E's discharge in bankruptcy was granted.
6. Dr. F was besieged with frivolous lawsuits immediately following a negative expose on local television. Simply put, a number of claimants saw an opportunity to extract money from Dr. F by subjecting him to the hazards of litigation and the high costs of defending himself. Not all of the cases were insured. Those that were insured caused his malpractice premiums to soar, and as a result he abandoned his practice. After a few years of Fighting the legal battles, Dr. F developed an APP strategy under which his assets were protected to the extent permitted under applicable fraudulent conveyance law, given his situation as it then existed. Dr. F then skillfully proceeded to negotiate an end to his remaining malpractice suits, each of which was settled for $2,500.00 or less.
7. Messrs. G, H and I made the decision to separate their personal assets from their business activities through settling and funding APTs at a time when their business was current on all its obligations, and was cash rich. At this time, there was no reason to believe that they would be called on with respect to the personal guaranty they each had signed and on which they were jointly and severally liable. Each settlor remained solvent immediately following his transfers. The APTs were thus funded so as to not run afoul of applicable fraudulent conveyance law. A few years later, reversals in the economy and their business started a slow downward spiral that culminated in the assets of their APTs being pursued overseas. This pursuit proved unsuccessful and the creditor ultimately agreed to a global settlement on a substantially discounted basis. No settlement payment was required of, or was made by any of the APTs involved.
8. Mr. and Mrs. J were referred for APP by their litigation counsel at a time when they were being sued. The plaintiff had elected its remedies and was suing Mr. and Mrs. J directly on a promissory note, rather than proceeding with foreclosure of the property that secured the note, and then moving against Mr. and Mrs. J to collect any resulting deficiency. The plaintiff was interested in a substantial managed account owned by Mr. and Mrs. J, which, once attached and executed on, would have subjected Mr. and Mrs. J to a hefty capital gain tax. The goal of the planning in this case was not to leave the plaintiff unpaid; rather, it was to direct the plaintiff away from the managed account, and toward the real property securing the indebtedness. The assets to be protected were transferred to an APT. Applicable fraudulent conveyance law was not violated given the intent of Mr. and Mrs. J, and given that they remained solvent following the transfers. The APT protected the subject assets in that the plaintiff was forced to look to the real property which secured the obligation. The managed account that Mr. and Mrs. J desired to retain remained protected, and the large capital gain tax was avoided.
Conclusion
One cannot — and should not — be so black and white as to say "this planning technique works" or "that planning technique does not work." It is not that easy or that basic. In fact, the author has seen dummy real estate liens and fraudulent transfers "work" (which by the way are not techniques advised by the author), and proper family limited partnerships not "work" in the asset protection context.
The temptation to conclude that "your trust has a hole" merely because some percentage of challenges over time may have less than satisfactory results for the APT must be resisted. After all, what skilled wealth planner would take the position that all marital deduction trusts should be avoided because the marital deduction has been disallowed in a small number of cases?
1 Engel,"Asset Protection and Fear of Flying," Offshore Investment No. 36, p. 28 (1993).
2 McMenamin, "Your Trust Has a Hole," Fortes p. 240 (June 15,1998).
3 Id. at 241.