Florida Supreme Court Limits Charging Order ProtectionJacob Stein Esq.
June 30, 2010 — 1,291 views
In a recent decision (Olmstead v. FTC, Supreme Court of Florida, June 24, 2010), the Florida Supreme Court held that the charging order protection, an "exclusive remedy" for creditors pursuing LLC interests, is actually not the exclusive remedy, despite the plain meaning of the statute.
In a fairly difficult to read and follow opinion, the Court held that Florida's general collection statute authorizing liens and levys on all assets, was not limited by the charging order statute despite the fact that the charging order statute provides that it is the exclusive remedy for a creditor pursuing an LLC membership interest.
This is really a case of statutory interpretation and nothing more. But as far as statutory interpretation goes, this is more of a case of judicial legislation.
The dissent opinion is a lot more logical (and easier to read). I particularly enjoyed the fact that the dissent partially relied on an article written by me a couple of years ago on LLC charging order protection.
I hope the Florida legislature will act quickly to re-write the statutes to read that the charging order is "really, really, really the exclusive remedy."
To read the full decision of the Florida Supreme Court, please follow this link:
Jacob Stein Esq.
Mr. Stein is a partner with the law firm Boldra, Klueger and Stein, LLP, in Los Angeles, California. The firm's practice is limited to asset protection, domestic and international tax planning, and structuring complex business transactions. The firm's goal is to provide the highest quality legal work that is usually associated with only the biggest law firms, in a boutique firm setting. Jacob received his law degree from the University of Southern California, and his Master's of Law in Taxation from Georgetown University. Mr. Stein has been accredited by the State Bar of California as a Certified Tax Law Specialist and is AV-rated (highest possible rating) by Martindale-Hubbell.