# Suing Yourself and Garnishing Wages to Frustrate Creditors **URL:** \ **Category:** Factual Questions\ **Created:** [August 23, 2005, 1:40pm UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254 "2005-08-23T13:40:54Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![Gfactor](https://avatars.discourse-cdn.com/v4/letter/g/9de053/32.png) [@Gfactor](https://boards.straightdope.com/u/Gfactor)\ **Post date:** [August 24, 2005, 4:18pm UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/21 "2005-08-24T16:18:31Z")
> [@Campion](#): > > As others have said, the debtor’s exam is a powerful tool, particularly because it can be used not only to inquire of the debtor, but to inquire of others, like family, friends, and employers. I’ve only ever once come close to being able to do a debtor’s exam, and when the defendant’s lawyer explained what was going to happen, the defendant miraculously “found” the money he owed my client. It is a powerful tool for one who knows how to use it. I’ve seen all kinds of amateurish blunders from otherwise experienced lawyers, including: 1. Not getting a transcript. This is encouraged by most courts. Judges don’t want to waste their time presiding over creditors exams. So they “allow” lawyers to do them at their offices or in the court hallway. When the defendant lies or refuses to answer, the lawyer can’t prove it. 2. Not requesting documents. In most jurisdictions, you can require the witness to produce documents like tax returns, bank records, contracts, and check registers. If you don’t get the documents, the debtor can lie about what they say. Many jurisdictions limit the frequency of debtor’s exams. So if the debtor lies about bank records, it may be six months before you can question him on the issue again. 3. Not examinin other witnesses. As you say, this is the best part of the deal. Most lawyers never use it. 4. Not understanding enough business law to meaningfully question the debtor about transactions involving business entities. For instance in the Ohio case that I mentioned earlier, I hired a firm that specialized in collection law to try to find the debtor’s assets. I got a call back from the associate who had done the debtor’s exam. She said, “He’s got an interest in an LLC.” I said, great, who else has an interest? Dunno. Is he a member? Dunno. Is it member managed? Dunno. What do the LLC documents say? Dunno. Didn’t he bring them? No. Why not? I didn’t ask for any documents. So we don’t have tax records, bank records, corporate records, or records of real estate transfers? No. I shipped you a bunch of documents that I found on the Internet, did you ask him about any of those? Nope. Let’s attach his LLC interest. How do I do that? Can you send me a copy of the transcript? Um, we did it at our office. I get that, why didn’t you have a court reporter present? Ummmm . . . Was the debtor even under oath? Ummmmmmmm . . . Are you sure you are an attorney? And on and on. Worthless. > [@](#): > > No. Let’s fight over estoppel, or, more specifically, that one is estopped to do something. The only proper usage is “estopped to.” Hearing “estopped from” sends chills down my spine. LOL. What if I don’t want to fight? ---
**Author:** ![Campion](https://avatars.discourse-cdn.com/v4/letter/c/4491bb/32.png) [@Campion](https://boards.straightdope.com/u/Campion)\ **Post date:** [August 24, 2005, 4:32pm UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/22 "2005-08-24T16:32:33Z")
> [@Gfactor](#): > > 1. Not getting a transcript. This is encouraged by most courts. Judges don’t want to waste their time presiding over creditors exams. So they “allow” lawyers to do them at their offices or in the court hallway. When the defendant lies or refuses to answer, the lawyer can’t prove it. If my client’s paying me, and I can get a record of what I’m doing, I’m getting the record. Even if I never order the transcript, at least there will be one. > [@Gfactor](#): > > LOL. What if I don’t want to fight? Too late! It’s on now: > [@Mr. Slant](#): > > No way! I’ve ALWAYS seen estoppel written out, and “estopped to” has not once showed up in the 20 times I’ve seen that word. Then again, if we want to hijack my thread, we could debate “endorsing” financial instruments versus “indorsing” them. You, sir, are a genius. Now I will giggle at inappropriate times all day today. [/hijack] ---
**Author:** ![Gfactor](https://avatars.discourse-cdn.com/v4/letter/g/9de053/32.png) [@Gfactor](https://boards.straightdope.com/u/Gfactor)\ **Post date:** [August 24, 2005, 4:50pm UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/23 "2005-08-24T16:50:55Z")
> [@Campion](#): > > If my client’s paying me, and I can get a record of what I’m doing, I’m getting the record. Even if I never order the transcript, at least there will be one. You’re hired. Er, what state were you in again? 😃 ---
**Author:** ![Northern\_Piper](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/northern_piper/32/5304_2.png) [@Northern\_Piper](https://boards.straightdope.com/u/Northern_Piper)\ **Post date:** [August 24, 2005, 5:00pm UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/24 "2005-08-24T17:00:18Z")
If a parsley farmer owes you money, can you garnish his wages? thanks folks, I’m here all week. 😛 ---
**Author:** ![Nametag](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/nametag/32/406_2.png) [@Nametag](https://boards.straightdope.com/u/Nametag)\ **Post date:** [August 24, 2005, 5:12pm UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/25 "2005-08-24T17:12:57Z")
> [@Chefguy](#): > > [Garnishee (garnisheed, garnisheeing)](http://www.hyperdictionary.com/dictionary/garnishee). Please note the second definition as a transitive verb. Dictionaries often list unjustifiable usages after the preferred ones. In this case, Bryan Garner, editor of Black’s Law Dictionary (whatever-it-is’th edition) and author of _A Dictionary of Modern American Usage_ and _A Dictionary of Modern Legal Usage_, calls the use of _garnishee_ as a verb “historically unwarranted and therefore ill-advised.” ---
**Author:** ![Gfactor](https://avatars.discourse-cdn.com/v4/letter/g/9de053/32.png) [@Gfactor](https://boards.straightdope.com/u/Gfactor)\ **Post date:** [August 24, 2005, 5:17pm UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/26 "2005-08-24T17:17:10Z")
> [@Nametag](#): > > Dictionaries often list unjustifiable usages after the preferred ones. In this case, Bryan Garner, editor of Black’s Law Dictionary (whatever-it-is’th edition) and author of _A Dictionary of Modern American Usage_ and _A Dictionary of Modern Legal Usage_, calls the use of _garnishee_ as a verb “historically unwarranted and therefore ill-advised.” Thanks, I was searching for my copy of MLU. ---
**Author:** ![Campion](https://avatars.discourse-cdn.com/v4/letter/c/4491bb/32.png) [@Campion](https://boards.straightdope.com/u/Campion)\ **Post date:** [August 24, 2005, 8:11pm UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/27 "2005-08-24T20:11:45Z")
> [@Gfactor](#): > > You’re hired. Er, what state were you in again? 😃 California. But I doubt you can afford me. 😉 ---
**Author:** ![Gfactor](https://avatars.discourse-cdn.com/v4/letter/g/9de053/32.png) [@Gfactor](https://boards.straightdope.com/u/Gfactor)\ **Post date:** [August 24, 2005, 8:15pm UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/28 "2005-08-24T20:15:08Z")
> [@Campion](#): > > California. But I doubt you can afford me. 😉 You get what you pay for. ---
**Author:** ![Random](https://avatars.discourse-cdn.com/v4/letter/r/57b2e6/32.png) [@Random](https://boards.straightdope.com/u/Random)\ **Post date:** [August 24, 2005, 8:48pm UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/29 "2005-08-24T20:48:44Z")
> [@Mr. Slant](#): > > Then again, if we want to hijack my thread, we could debate “endorsing” financial instruments versus “indorsing” them. All fun! How about “guaranty” vs. “guarantee” when used as a noun? ---
**Author:** ![Gfactor](https://avatars.discourse-cdn.com/v4/letter/g/9de053/32.png) [@Gfactor](https://boards.straightdope.com/u/Gfactor)\ **Post date:** [August 24, 2005, 8:54pm UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/30 "2005-08-24T20:54:34Z")
> [@Random](#): > > All fun! How about “guaranty” vs. “guarantee” when used as a noun? Hey, what’s the difference between setoff and recoupment? ---
**Author:** ![Campion](https://avatars.discourse-cdn.com/v4/letter/c/4491bb/32.png) [@Campion](https://boards.straightdope.com/u/Campion)\ **Post date:** [August 24, 2005, 9:29pm UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/31 "2005-08-24T21:29:50Z")
> [@Northern Piper](#): > > If a parsley farmer owes you money, can you garnish his wages? > [@Gfactor](#): > > > [@Random](#): > > > > All fun! How about “guaranty” vs. “guarantee” when used as a noun? > > Hey, what’s the difference between setoff and recoupment? Why on earth do people think lawyers have no sense of humor? Y’all could totally take this show on the road. ---
**Author:** ![SlyFrog](https://avatars.discourse-cdn.com/v4/letter/s/a3d4f5/32.png) [@SlyFrog](https://boards.straightdope.com/u/SlyFrog)\ **Post date:** [August 24, 2005, 9:33pm UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/32 "2005-08-24T21:33:39Z")
> [@Gfactor](#): > > Hey, what’s the difference between setoff and recoupment? The disturbing thing is that I had to review this at one point as a tangential item to my main research. I have since forgotten the bulk of it; rough memory tells me that it has something to do with whether the claim is connected with origins or basis of the main action or debt. ---
**Author:** ![Gfactor](https://avatars.discourse-cdn.com/v4/letter/g/9de053/32.png) [@Gfactor](https://boards.straightdope.com/u/Gfactor)\ **Post date:** [August 24, 2005, 10:32pm UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/33 "2005-08-24T22:32:22Z")
> [@SlyFrog](#): > > The disturbing thing is that I had to review this at one point as a tangential item to my main research. I have since forgotten the bulk of it; rough memory tells me that it has something to do with whether the claim is connected with origins or basis of the main action or debt. I once wrote a longer analysis that looked a lot like this memo: [http://www.sheehan.com/publications.asp?id=967](http://www.sheehan.com/publications.asp?id=967) In the case for which I wrote it, the difference was around two hundred thousand dollars. ---
**Author:** ![SlyFrog](https://avatars.discourse-cdn.com/v4/letter/s/a3d4f5/32.png) [@SlyFrog](https://boards.straightdope.com/u/SlyFrog)\ **Post date:** [August 24, 2005, 11:05pm UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/34 "2005-08-24T23:05:35Z")
> [@Gfactor](#): > > I once wrote a longer analysis that looked a lot like this memo: [http://www.sheehan.com/publications.asp?id=967](http://www.sheehan.com/publications.asp?id=967) > > In the case for which I wrote it, the difference was around two hundred thousand dollars. Cool beans. This is the part I fuzzily remembered: “More precisely, the main distinction between the two is that while setoff arises from a cross-action that is premised in its application upon the existence of two independent mutual obligations, recoupment arises from the right of a creditor to reduce the amount of a claim against it held by the debtor and does not require the creditor to prove the existence of independent obligations.” I wish I could remember more things. One of the drawbacks to being a general practitioner I guess - you find the answer to so many things, but then five years later, having only needed the answer for that one particular circumstance, you know that you found it once, but no longer remember what it was (of course you have your papers, but it’s much more fun to say dazzlingly, “As I recall . . . .”). ---
**Author:** ![SlyFrog](https://avatars.discourse-cdn.com/v4/letter/s/a3d4f5/32.png) [@SlyFrog](https://boards.straightdope.com/u/SlyFrog)\ **Post date:** [August 24, 2005, 11:08pm UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/35 "2005-08-24T23:08:16Z")
> [@SlyFrog](#): > > . . . of course you have your papers, but it’s much more fun to say dazzlingly, “As I recall . . . .” I should note that it is much more fun to do it this way while checking the deductible and limit on the firm’s malpractice policy. ---
**Author:** ![Bricker](https://avatars.discourse-cdn.com/v4/letter/b/977dab/32.png) [@Bricker](https://boards.straightdope.com/u/Bricker)\ **Post date:** [August 25, 2005, 1:23am UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/36 "2005-08-25T01:23:25Z")
You civil guys have such fun… ---
**Author:** ![Northern\_Piper](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/northern_piper/32/5304_2.png) [@Northern\_Piper](https://boards.straightdope.com/u/Northern_Piper)\ **Post date:** [August 26, 2005, 4:37am UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/37 "2005-08-26T04:37:20Z")
> [@Gfactor](#): > > Hey, what’s the difference between setoff and recoupment? > [@SlyFrog](#): > > “More precisely, the main distinction between the two is that while setoff arises from a cross-action that is premised in its application upon the existence of two independent mutual obligations, recoupment arises from the right of a creditor to reduce the amount of a claim against it held by the debtor and does not require the creditor to prove the existence of independent obligations.” hmmm. to continue the digressions, I don’t recognize the term “recoupment” - here in Canada, we distinguish between common law and equitable set-off, which sounds similar to those definitions. Several years ago, I was involved in a major appeal that considered the differnce between the two types of set-off, amongst other issues. ---
**Author:** ![Chefguy](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/chefguy/32/138_2.png) [@Chefguy](https://boards.straightdope.com/u/Chefguy)\ **Post date:** [August 26, 2005, 5:01am UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/38 "2005-08-26T05:01:43Z")
> [@Campion](#): > > Why on earth do people think lawyers have no sense of humor? Y’all could totally take this show on the road. “…and then I _stepped_ on the ping-pong ball!” ---
**Author:** ![wellington](https://avatars.discourse-cdn.com/v4/letter/w/dfb087/32.png) [@wellington](https://boards.straightdope.com/u/wellington)\ **Post date:** [August 26, 2005, 7:55pm UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/39 "2005-08-26T19:55:08Z")
If you listen to the radio enough you’ll hear ads for Nevada corporations. These can be used to hide assets since the state does not collect any info on ownership, officers or directors. As long as you are willing to commit perjury… Bob should, of course have been more careful. Simply create a note from Bob to an llc owned by his trusted Uncle Joe, have Uncle Joe own the llc, and then proceed as outlined. Of course, if the dollars are big enough there are off shore methods for illegally hiding dollars. Want a legal way to do this? Take all your money and move to Florida buying the biggest house you can for cash. Our courts will protect homestead from even fraud claims! Just make sure its 1/2 acre or less in munis, or 160 acres outside! ---
**Author:** ![Gfactor](https://avatars.discourse-cdn.com/v4/letter/g/9de053/32.png) [@Gfactor](https://boards.straightdope.com/u/Gfactor)\ **Post date:** [August 26, 2005, 9:21pm UTC](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254/40 "2005-08-26T21:21:43Z")
> [@](#): > > Want a legal way to do this? Take all your money and move to Florida buying the biggest house you can for cash. Our courts will protect homestead from even fraud claims! Just make sure its 1/2 acre or less in munis, or 160 acres outside! If by legal, you mean, one that will work, uh uh. . . > [@](#): > > 222.30 Fraudulent asset conversions.– > > (1) As used in this section, “conversion” means every mode, direct or indirect, absolute or conditional, of changing or disposing of an asset, such that the products or proceeds of the asset become immune or exempt by law from claims of creditors of the debtor and the products or proceeds of the asset remain property of the debtor. The definitions of chapter 726 apply to this section unless the application of a definition would be unreasonable. > > (2) Any conversion by a debtor of an asset that results in the proceeds of the asset becoming exempt by law from the claims of a creditor of the debtor is a fraudulent asset conversion as to the creditor, whether the creditor’s claim to the asset arose before or after the conversion of the asset, if the debtor made the conversion with the intent to hinder, delay, or defraud the creditor. > > (3) In an action for relief against a fraudulent asset conversion, a creditor may obtain: > > (a) Avoidance of the fraudulent asset conversion to the extent necessary to satisfy the creditor’s claim. > > (b) An attachment or other provisional remedy against the asset converted in accordance with applicable law. > > (c) Subject to applicable principles of equity and in accordance with applicable rules of civil procedure: > > 1. An injunction against further conversion by the debtor of the asset or of other property. > > 2. Any other relief the circumstances may require. > > (4) If a creditor has obtained a judgment on a claim against the debtor, the creditor, if the court so orders, may levy execution on the asset converted or its proceeds. > > (5) A cause of action with respect to a fraudulent asset conversion is extinguished unless an action is brought within 4 years after the fraudulent asset conversion was made. > > (6) If an asset is converted and the converted asset is subsequently transferred to a third party, the provisions of chapter 726 apply to the transfer to the third party. [http://www.leg.state.fl.us/statutes/index.cfm?App\_mode=Display\_Statute&URL=Ch0222/ch0222.htm](http://www.leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=Ch0222/ch0222.htm) [http://www.protectyou.com/apn2-5-fr.html](http://www.protectyou.com/apn2-5-fr.html) > [@](#): > > Bob should, of course have been more careful. Simply create a note from Bob to an llc owned by his trusted Uncle Joe, have Uncle Joe own the llc, and then proceed as outlined. And how will you explain the payments to the IRS? If Uncle Joe doesn’t 1099 you, then he’ll have to report the payments as income and pay taxes on them himself. And even then, you’re both still committing tax fraud and perjury. > [@wellington](#): > > If you listen to the radio enough you’ll hear ads for Nevada corporations. These can be used to hide assets since the state does not collect any info on ownership, officers or directors. As long as you are willing to commit perjury… And tax fraud. Plus, Nevada requires one to list managers or members: [list of managers or members](http://secretaryofstate.biz/comm_rec/crforms/2003/Initial%20List%20of%20Man%20or%20Mempk.pdf) (pdf) [http://www.leg.state.nv.us/NRS/NRS-086.html#NRS086Sec263](http://www.leg.state.nv.us/NRS/NRS-086.html#NRS086Sec263) Of course, you could hire a manager, or get a friend to be manager, but you’d still have all of the issues previously discussed to contend with, plus you’d have to count on someone else to lie for you and risk criminal sanctions for perjury. > [@](#): > > Of course, if the dollars are big enough there are off shore methods for illegally hiding dollars. Offshore trusts usually don’t work if you create them in order to hinder known creditors. [http://www.mosessinger.com/articles/files/offshoretrust.htm](http://www.mosessinger.com/articles/files/offshoretrust.htm) [http://www.studyfinance.com/jfsd/pdffiles/v12n1/switzer.pdf](http://www.studyfinance.com/jfsd/pdffiles/v12n1/switzer.pdf) (discussing similar spendthrift provisions recently adopted in Alaska and Deleware). [http://www.trustsassetprotection.com/fapt.htm](http://www.trustsassetprotection.com/fapt.htm) [Previous page](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254.md?page=1) [Next page](https://boards.straightdope.com/t/suing-yourself-and-garnishing-wages-to-frustrate-creditors/318254.md?page=3)