Florida’s Fourth District Court of Appeals ruled that a debtor cannot be compelled to turn over a stock certificate in a company located outside of Florida. In this case the debtor owned a myriad of foreign corporations, based in the Netherlands, the Bahamas and the Dominican Republic. Rather than ordering the turnover of the shares, as all other decided cases have previously ruled, the Florida Court claimed it was bad legal policy for courts to compel collection of stock in companies outside the jurisdiction. Instead the creditor would have to go to each of the home countries of the corporations to attempt collection there.
The courts’ ruling would apparently apply as well to stock in domestic companies located outside of Florida and there is no reason why the same logic would not encompass any assets held outside the state. Effectively, anyone living in Florida is now able to avoid collection on judgments and payments on claims as long as their assets are safely parked in an out of state or foreign company or trust.
We don’t know how long this case law will last. The Florida legislature or the state Supreme Court may overturn the absurd result, but for now at least, the state has found a new reason to attract many permanent residents.
New York Times Article – Ruling Could Escalate Florida’s Status as Haven for Debtors
District Court of Appeals State of Florida – Sargeant v. Al-Saleh