Under California Probate Code §15304, a spendthrift clause in a self-settled trust is unenforceable against the settlor’s own creditors. If you can receive distributions from a trust you created, your creditors can reach that same beneficial interest. California has no domestic asset protection trust statute, and courts have applied this rule consistently for over seventy-five years.
If you are looking for an asset protection trust in California, this is the statute that governs whether California law will let your creditors reach a trust you create for your own benefit. This page lays out the statute subsection by subsection, what the cases actually hold, why out-of-state trusts do not fix it, and what does work for a California resident.
Key Points
- §15304(a) voids the spendthrift restraint as to the settlor’s own creditors.
- §15304(b) lets creditors reach the maximum a trustee could distribute to the settlor, even in a fully discretionary trust.
- §15304(c), added by AB 1866 in 2022, permits tax reimbursement to the settlor without expanding creditor rights. It was a tax fix, not a loophole.
- §18200 separately exposes every revocable living trust to the settlor’s creditors during life.
- Control decides outcomes, not drafting. In re Cutter failed on control despite an irrevocable, properly drafted instrument.
- Out-of-state DAPTs do not escape it. Huckaby applied California law to California real property despite a Nevada choice-of-law clause.
- A trust created to defraud can simply be disregarded. Marriage of Dick gives California a second route that does not require a voidable transaction lawsuit — and Berman shows it is still being applied.
- Intent is the legal test. Timing is the evidence. The court asks why the trust was created, and reads the calendar to answer it.
- Divorce, spousal support, and child support are different. A spouse is not a creditor, and no structure — domestic or offshore — can be used to hide marital or community property or avoid support obligations.
What Is a Self-Settled Trust?
A trust in which the person who creates and funds it is also a beneficiary of it. The same individual is settlor and beneficiary — often trustee as well. That overlap is what triggers §15304, because California will not let a person shield property from creditors while continuing to enjoy it.
Three roles exist in every trust. The settlor creates and funds it. The trustee holds legal title and administers it. The beneficiary receives the benefit.
When the settlor and beneficiary are the same person, the trust is self-settled. When the settlor is also the trustee, courts look harder still — that is the fact pattern that fails most often.
By contrast, a third-party trust is one you create for someone else — a trust for your children, funded by you, that they did not create. Third-party spendthrift protection is fully enforceable in California. The distinction is not a technicality. It is the entire dividing line between protection that holds and protection that does not.
A worked example
A physician transfers $2 million into an irrevocable trust. She names an independent trustee. The trust says the trustee may distribute income and principal to her for health, education, maintenance, and support, at the trustee’s sole discretion. It includes a spendthrift clause. She keeps nothing on paper.
Two years later a judgment is entered against her.
Under §15304(b), her creditor can reach the maximum amount the trustee could distribute to or for her benefit — which, under a HEMS standard funded entirely by her own contribution, is effectively the whole trust. The spendthrift clause does not stop it, because §15304(a) makes it unenforceable against her creditors. The trust still exists. The protection does not.
Nothing was drafted wrong. The structure was self-settled, and in California that is enough.
What Does California Probate Code §15304 Actually Say?
Three subsections. (a) voids the spendthrift restraint against the settlor’s own creditors. (b) lets creditors reach the maximum amount a trustee could distribute to the settlor, limited to the settlor’s own contributions. (c), added in 2022, permits tax reimbursement without expanding creditor access.
§15304(a) — the core rule. Where a settlor is a beneficiary of a trust and the trust contains a restraint on the transfer of the settlor’s interest, that restraint is invalid against transferees and creditors of the settlor. In plain terms: your own spendthrift clause does not work against your own creditors.
§15304(b) — the discretionary trap. Where the trustee has discretion to pay income or principal to the settlor, a creditor may reach the maximum amount the trustee could pay to or apply for the settlor’s benefit — limited to the portion attributable to the settlor’s own contribution. This is the provision most people miss. Handing discretion to an independent trustee does not solve the problem, because the measure is what the trustee could pay, not what the trustee actually pays.
§15304(c) — the 2022 amendment. Added by AB 1866 (2022), effective January 1, 2023, this subsection allows a trustee to reimburse the settlor for income tax paid on trust income without that reimbursement power expanding creditor rights.
That amendment gets misread constantly. It was a narrow tax clarification addressing grantor-trust income tax reimbursement. It did not create a California DAPT, did not weaken §15304(a) or (b), and did not open a door. California still does not recognize self-settled asset protection trusts.
The related provision people miss: §18200
Probate Code §18200 provides that while a trust is revocable, its assets are reachable by the settlor’s creditors during the settlor’s lifetime to the extent of the power of revocation.
In an ordinary revocable living trust, the power of revocation covers everything. So the answer for the most common estate planning instrument in California is simple: a revocable living trust provides no creditor protection at all during your life. It is a probate-avoidance tool. It was never designed to be anything else.
What Do California Courts Actually Do With §15304?
They look at control, not language. Seventy-five years of consistent authority holds that a person cannot enjoy property while keeping it from creditors — and courts apply that to irrevocable, properly drafted trusts where the settlor retained the ability to benefit.
Sheean v. Michel, 6 Cal.2d 324 (1936). The California Supreme Court disregarded a trust arrangement where the settlor kept effective control, holding that a person may not have absolute and uncontrolled ownership of property for his own purposes while simultaneously keeping it from creditors.
Nelson v. California Trust Co., 33 Cal.2d 501 (1949). Thirteen years later, the same court allowed a judgment creditor to reach the assets of a trust the debtor created and of which he was sole beneficiary, holding the restraints on alienation invalid. The court’s reasoning was that public policy does not permit a person to tie up property so that he can enjoy it while preventing creditors from reaching it.
Ehrenberg v. Southern California Permanente Medical Group (In re Moses), 167 F.3d 470, 473 (9th Cir. 1999). The Ninth Circuit stated the rule directly: California law voids self-settled trusts to prevent individuals from placing property beyond creditors’ reach while still reaping its bounties.
Cutter v. Seror (In re Cutter), 398 B.R. 6 (B.A.P. 9th Cir. 2008), aff’d 468 F. App’x 657 (9th Cir. 2011). This is the case worth studying, because the trust looked right. A debtor created an irrevocable trust and named himself trustee. The instrument expressly allowed him, as trustee, to make distributions for his own benefit in his sole discretion — which is why the panel concluded he was a primary beneficiary of his own trust. That is a worse fact than an ascertainable standard, and it is the fact that decided the case. (On review, the BAP affirmed partial summary judgment against the debtor and reversed in part — entering judgment for the trustee on an additional fractional interest in trust property. The reversal ran further against the debtor, not in his favor.) The court held the spendthrift clause unenforceable against his creditors and allowed the bankruptcy estate to reach the maximum the trust could pay him — including property that other people had contributed, because he could reach that too.
The trust was irrevocable. It was properly drafted. It failed on control.
That rule has not moved in seventy-five years. That is not a gap in the case law. That is the law being settled.
Can a California Resident Use a Nevada or Wyoming Trust Instead?
Rarely with success. California courts apply California public policy regardless of where a trust was formed, and where the settlor lives in California or the asset is California real property, California law generally controls the creditor question.
For years, the case most often cited on this point was Kilker v. Stillman (Cal. Ct. App. 2012), frequently described as a California court declining to honor a Nevada self-settled trust against a California creditor. It is an unpublished decision, non-citable as precedent under California Rules of Court, rule 8.1115, and it is mentioned here only because it appears so often in commentary on this question. It is not authority.
The citable version arrived in 2026.
United States v. Huckaby, No. 2:23-cv-00587-DAD-JDP (E.D. Cal. Mar. 2, 2026) is the current, on-point illustration.
A self-settled Nevada spendthrift trust held California real property. Under Restatement (Second) of Conflict of Laws §277, the court agreed Nevada law governed interpretation of the instrument. But under §280, whether a beneficiary’s interest in a trust of land can be reached by creditors is governed by the law of the situs of the land. The property sat in California, so California law controlled the creditor question, §15304 applied, and the federal judgment lien attached under 28 U.S.C. §3201(a).
The court also rejected the argument that §15304 should not apply retroactively to property placed in trust before the lien arose.
This was a district-court order granting partial summary judgment — persuasive and directly on point, not binding appellate precedent.
The pattern is not confined to California. In In re Huber, 493 B.R. 798 (Bankr. W.D. Wash. 2013), a bankruptcy court applied Washington law to an Alaska trust created by a Washington resident. In Dahl v. Dahl, 345 P.3d 566 (Utah 2015), the forum applied its own law over the trust’s chosen governing law — though that case arose in a divorce rather than a creditor enforcement action, which limits how far it travels.
Different states, one principle: the settlor’s home forum, not the trust’s paperwork, decides creditor reach. For a Californian, that forum is California.
There is a plain-English version worth carrying: you cannot move dirt. Land is governed by the law of the place it occupies, and no choice-of-law clause changes that.
Do LLCs Solve the Problem in California?
Partially, and less than most people believe. California’s charging order is technically the exclusive remedy — but the exclusive remedy itself includes receivership and foreclosure of the interest. Reverse veil piercing adds another layer.
Under Corporations Code §17705.03, a creditor can obtain a charging order against a member’s interest and intercept distributions.
It is often said that California’s charging order is not an exclusive remedy. That is not quite right, and the distinction matters more than the shorthand. §17705.03(f) states that the section provides the exclusive remedy by which a judgment creditor may satisfy a judgment from a debtor’s transferable interest.
The problem is not exclusivity. The problem is what California’s exclusive remedy contains. §17705.03(b)(1) authorizes appointment of a receiver over the distributions. §17705.03(b)(3) authorizes foreclosure of the charging order lien and sale of the transferable interest itself.
California’s exclusive remedy includes the power to take the interest away and sell it. Compare Arizona, where A.R.S. §29-341 makes the charging order exclusive against a limited partner’s interest with no foreclosure authorization.
Reverse veil piercing adds a second layer. In Curci Investments, LLC v. Baldwin, 14 Cal.App.5th 214 (2017), the court held reverse veil piercing may be available against an LLC and returned the question to the trial court — it did not itself pierce, and it is frequently described as having gone further than it did. Four years later the Court of Appeal did go further, in Blizzard Energy, Inc. v. Schaefers, 71 Cal.App.5th 832 (2021), applying the doctrine to a multi-member LLC while requiring the trial court to weigh harm to an apparently innocent co-member.
The doctrine is live in California. How far it reaches is still being worked out, and that uncertainty is itself part of the exposure.
What If I Move Assets Into a Trust After a Claim Appears?
That creates a separate and often larger problem. California’s Uniform Voidable Transactions Act lets courts unwind transfers made with intent to hinder or delay creditors, and courts apply the eleven-factor badges-of-fraud test aggressively.
Under Civil Code §3439.01 et seq., a court may unwind a transfer made with actual intent to hinder or delay creditors (§3439.04(a)(1)), or one made without reasonably equivalent value while the debtor was insolvent (§3439.04(a)(2) and §3439.05). Intent is evaluated using the eleven badges of fraud in §3439.04(b).
There is an outer limit, and it runs in favor of the person who acted early. Under §3439.09, actual-intent claims run four years from the transfer or one year from discovery, whichever is later — and §3439.09(c) extinguishes any claim under the Act entirely if no action is brought within seven years of the transfer.
That repose only ever helps someone whose clock started in peacetime.
The timing of an asset protection structure is not a minor technical detail. It is frequently the entire legal question.
And There Is an Easier Route Than the UVTA
California does not need a voidable transaction lawsuit to reach a trust built to defraud. A court can simply disregard it — and that doctrine applies to offshore trusts and to trusts designed to keep property from a spouse.
Section 15304 and the UVTA are not the only tools. In In re Marriage of Dick, 15 Cal. App. 4th 144 (1993), the Court of Appeal stated the rule directly:
“It is well-settled that a trust created for the purpose of defrauding creditors or other persons is illegal and may be disregarded.”
The basis is Probate Code §15203, which permits a trust only for a purpose “that is not illegal or against public policy.” A trust whose purpose is to defraud fails that test at formation.
And the court applied it where the purpose was to keep property from a spouse — citing authority for the rule’s application to a trust created where the grantor’s intention “was to prevent his wife… from reaching the property.”
The facts will sound familiar
John Dick held his wealth through what the trial court called “a labyrinth of trusts and corporations designed by him… to shield and protect [him] from creditors.” Nothing stood in his name.
His principal residence was a manor on the Isle of Jersey, held by an offshore trust. The trust company administering it was operated by former employees of a trust company that had previously administered his trusts, with offices located at the manor itself. Its only other known clients were his brother-in-law and a longtime business associate.
He admitted instructing the trustee on investments, and that it had never made one he disapproved of. He was the only person who lived there. He paid no rent.
His children were the named beneficiaries. They had never received a disbursement.
In 1984, he “sold” all his U.S. assets to his former secretary and two business associates for $17.5 million in promissory notes not due until 1996. No cash changed hands. He then pledged the notes as collateral for a loan that went past due and was never collected. The court called it a sham.
The trial court found he had “an obsession with the concept of having no indicia of ownership of property standing in his name, yet controlling and using said property as if it were his own.”
What the court actually did with the trusts
It did not reach the offshore assets. It did not need to.
The Court of Appeal held the trial court was entitled to “look past the apparent form of ownership in which husband’s assets were held to determine the extent of husband’s true interest in them.” It found assets under his control worth more than $20 million and ordered him personally to pay $35,000 a month in temporary spousal support and more than $1 million in attorney and accounting fees.
The court reaches the person, not the trust. That is the same mechanism that appears throughout this area — and it is why an offshore trustee’s refusal to cooperate does not end the analysis.
And the principle is still being applied
Dick is not a thirty-year-old outlier. In In re Marriage of Berman, 15 Cal. App. 5th 914 (2017), a published decision, the Court of Appeal applied it to a husband who transferred his business to his new wife for no consideration and then asked to terminate spousal support.
The court imputed the business income to him anyway — relying on Dick‘s rule that a court may look past the apparent form of ownership, and on Dick‘s finding that transferees who “could… be expected to act at his behest” leave the transferor still able to pay.
Berman also drew a line worth knowing. The court was explicit that it was not holding a transfer to a relative improper. The transferor stays bound only where the transfer was in bad faith and he still has access to the benefit. Both conditions.
One precision point. Berman applies Dick‘s look-through and ability-to-pay reasoning. It does not restate Dick‘s separate rule that a trust created to defraud is illegal and may be disregarded. The two principles come from the same opinion and point the same direction, but they are distinct.
The question that decides these cases
Read Dick and Berman together and one question does most of the work: could the people holding your assets be expected to act at your behest?
In Dick, every link in the chain could. A trust company staffed by his former trust company’s employees, operating from his house, serving his brother-in-law and his business associate, and never once overriding him. A “sale” to his former secretary. In Berman, the transferee was his wife.
That is not a drafting question. It is a structural one, and it is answered by who you put in the chain — which means it can be answered correctly at the outset, or not at all.
Why this matters more than it looks
It is easier than a voidable transaction action. Under the UVTA, a creditor must sue, prove the statutory elements, and file within the limitations period. Under Dick, the question is whether the trust was created for a fraudulent purpose — and if so, the court disregards it.
It works against offshore structures. Jersey administration did not prevent the court from looking through the arrangement to determine what the husband actually controlled.
And it is an intent doctrine. The rule does not ask when the trust was created. It asks why — whether it was “created for the purpose of defrauding.” The trial court in Dick framed its finding exactly that way: the transfers to the offshore trusts were made “for the purpose of tax avoidance and to create a shelter from creditors.” Berman applies the same test under a different name: bad faith.
Timing is how intent gets proved. A court cannot read a settlor’s mind, so it reads the calendar. A trust funded years before any claim, for a legitimate purpose, is very difficult to characterize as created to defraud. A trust funded once a claim or a divorce is already in view almost describes itself.
Divorce, Spousal Support, and Child Support Are a Different Problem
Asset protection shields your own property from third-party creditors. It is not a tool for keeping marital or community property from a spouse, avoiding spousal support, or avoiding support owed to a child — and no jurisdiction changes that, offshore included.
Three family obligations, and a structure defeats none of them.
Property division. Under Family Code §760, property acquired during the marriage is presumed to be community property. A spouse asserting a claim to it is not a stranger trying to reach your assets — she is a co-owner asserting her own interest. You cannot protect what is not yours to protect.
Spousal support. This is where California’s case law is most direct. In Dick, offshore trusts were disregarded and the husband was ordered personally to pay $35,000 a month in temporary spousal support, plus more than $1 million in attorney and accounting fees. In Berman, a husband gave his business to his new wife for nothing and asked to end spousal support; the court imputed the business income to him anyway.
Child support. Most states that authorize self-settled asset protection trusts — the jurisdictions most sympathetic to this kind of planning — expressly carve out child support obligations, along with divorcing spouses, as exception creditors. Those carve-outs are written into the statutes on purpose.
Berman quoted the principle underneath all three:
“[T]he law does not sanction the shirking of familial responsibilities.”
— In re Marriage of Sinks, 204 Cal.App.3d 586, 594 (1988), quoted in Berman
Going fully offshore does not change the answer
The court does not need to reach the trust. It reaches the person.
Dick‘s trusts were administered in Jersey; the court ordered him to pay support anyway. In In re Marriage of Harnack, an Illinois husband moved marital stock into a Belize trust during his divorce. The trustee refused to repatriate, and the assets stayed offshore. He has been held in civil contempt in the Cook County Jail since June 2022, because a self-created inability to comply is not a defense.
Support orders are enforced against people, not against trusts. A family court can impute income, order payment from whatever the court finds you control, and hold you in contempt when you don’t pay.
Where this sits on the four pillars
Intent is the legal test. Timing is the evidence.
A structure funded years before any marital dispute, to protect against future third-party creditors, is planning. A structure funded to keep property from a spouse, to avoid spousal support, or to avoid supporting a child is not asset protection at all — and the purpose shows in the timing. Every court in these cases has read it that way.
The legitimate tools exist: a prenuptial or postnuptial agreement with full disclosure and independent counsel on both sides, trusts funded before the marriage, and third-party trusts created for someone rather than by them.
What Actually Works for a California Resident?
Jurisdiction, independence, and timing. The protection has to sit in a legal system built to resist U.S. creditor enforcement, it has to be held by people who will not act at your behest, and it has to be in place before a claim is foreseeable. None of those can be satisfied retroactively.
California’s litigation environment keeps expanding — recent legislation such as SB 71, which raised the small-claims limit to $12,500 effective in 2024, continues to widen access to the courts. The question is not whether legal exposure exists. It is when it will appear.
A structure that collapses under California’s control analysis is not protection. It is delayed vulnerability.
Fully offshore trusts
Jurisdictions such as the Cook Islands, Nevis, and Belize have legal frameworks built specifically for asset protection. They generally do not recognize U.S. judgments, impose short limitation periods on fraudulent-transfer claims, and require a creditor to prove fraudulent intent under a very high evidentiary standard.
They are effective. They are also complex and expensive to run as standalone, always-on structures, and they carry Form 3520 and 3520-A filing obligations from inception.
The Bridge Trust® hybrid model
The Bridge Trust® was built to deliver offshore-grade protection with domestic simplicity, and it does that by being one trust carrying two legal identities at once.
It does not pretend to escape §15304. The Bridge Trust is self-settled from the outset — the client is a beneficiary, and the structure says so plainly. Its protection does not depend on California treating it as something it is not. It depends on where the assets can be held, who controls them, and when and why the structure was built.
It is registered in Belize from inception. Belize is chosen for that role because its legislation provides no waiting period before protection attaches, and because it does not require a Belize trustee from the outset — which is what makes offshore registration compatible with domestic administration. Separately, a licensed trust company in the Cook Islands or Nevis is designated as Special Successor Trustee — the fiduciary who would administer the trust if the bridge is ever crossed.
Two independent tax rules then apply, and conflating them is the most common error in commentary about this structure. Because the instrument is drafted to satisfy the court test and control test of Treas. Reg. §301.7701-7 — the two-part test under IRC §7701(a)(30)(E) — the IRS classifies it as a domestic trust. Separately, it is drafted to establish and maintain grantor-trust status under IRC §§671–677, so income is reported on the settlor’s own return and the trust is disregarded for income tax purposes. One rule determines domestic-versus-foreign classification. The other determines who reports the income. Neither produces the other.
That classification is a drafting position earned on the facts of the instrument and on how the trust is actually administered. It does not come free with the form, and it is a substantial part of what careful drafting is for.
Because the trust assets remain includible in the settlor’s estate, the §1014 step-up in basis is preserved. While no threat exists, the trust runs domestically — normal banking, standard tax reporting, full regulatory compliance, no offshore filing burden.
Nothing converts when a threat arrives, because nothing has to. The offshore registration was always there. If a credible threat materializes, the Trust Protector — an independent attorney exercising professional judgment, not the settlor — may declare an Event of Duress under the governing instrument, before any restraining or turnover order issues, and control shifts to the pre-committed Special Successor Trustee in a jurisdiction where a U.S. court order carries no automatic force.
No assets move and no new trust is created at that moment — so there is no fraudulent-transfer event at the worst possible time. And the declaration is a documented decision by a qualified independent fiduciary, not a clause that fires automatically on the filing of a complaint. Courts read mechanical triggers tied to litigation events as obstruction. They do not read a professional’s reasoned judgment the same way.
And the Dick question has a structural answer. A licensed, regulated offshore trust company is not a relative, an employee, or a business associate. An independent attorney serving as Trust Protector is not either. Neither is a party who could be expected to act at the settlor’s behest — which is the fact Dick and Berman both turned on.
Intent and timing still govern everything. A structure established before any claim, for a legitimate purpose, is not a trust “created for the purpose of defrauding.” A structure funded after a claim is in view — or to defeat a spouse’s claim or a support obligation — is exposed under Dick, under the UVTA, and in bankruptcy under §548(e), regardless of where it is registered. That difference can only be established on the day the trust is funded.
No structure makes anyone judgment-proof, and no lawyer can promise a courtroom outcome. What a properly built and properly timed structure changes is what a creditor can reach and what it costs to try.
FAQs
Do self-settled spendthrift trusts work in California? No. Under Probate Code §15304(a), a spendthrift clause is unenforceable against the settlor’s own creditors in a trust the settlor created for their own benefit. If you can receive distributions from your own trust, your creditors can reach that same interest.
What is a self-settled trust? A trust where the person who created and funded it is also a beneficiary. When settlor and beneficiary are the same person, the trust is self-settled and §15304 applies.
What does California Probate Code §15304 say? Subsection (a) voids the spendthrift restraint against the settlor’s creditors. Subsection (b) lets creditors reach the maximum amount a trustee could distribute to the settlor, limited to the settlor’s own contributions. Subsection (c), added by AB 1866 in 2022, permits tax reimbursement without expanding creditor rights.
Did AB 1866 create a California asset protection trust? No. It added §15304(c) to allow a trustee to reimburse the settlor for income tax paid on trust income. It was a narrow tax clarification and did not change the underlying rule.
Does an independent trustee with full discretion solve the problem? No. Under §15304(b), the measure is the maximum amount the trustee could pay to or for the settlor’s benefit, not what the trustee actually pays.
Are revocable living trusts protected from creditors in California? No. Under §18200, while a trust is revocable its assets are reachable by the settlor’s creditors during the settlor’s lifetime to the extent of the power of revocation — which in an ordinary living trust means all of them.
Can a California resident protect assets with a Nevada or Wyoming trust? Rarely. California courts apply California public policy even where the trust chooses another state’s law. Where the settlor lives in California or the asset is California real property, California law generally controls the creditor question — as in Huckaby, and as courts in other states have held on the same reasoning in In re Huber and Dahl v. Dahl.
What about Kilker v. Stillman? It is frequently cited on this question, but it is an unpublished 2012 decision and cannot be cited as precedent under California Rules of Court, rule 8.1115. Huckaby is the citable authority.
Does an irrevocable trust solve it? Not by itself. In In re Cutter, the trust was irrevocable and properly drafted, and it still failed — because the settlor served as trustee and retained the ability to distribute to himself.
Can a California court disregard a trust without a fraudulent transfer lawsuit? Yes. Under In re Marriage of Dick, 15 Cal. App. 4th 144 (1993), a trust created for the purpose of defrauding creditors or other persons is illegal and may be disregarded, based on Probate Code §15203.
Is Marriage of Dick still good law? Yes. It was applied in In re Marriage of Berman, 15 Cal. App. 5th 914 (2017), a published decision imputing business income to a husband who transferred his business to his new wife to avoid spousal support.
Is it about timing or intent? Both — but intent is the legal test. Dick asks whether the trust was created for the purpose of defrauding. Timing is the strongest evidence of that purpose.
Does an offshore trust avoid that rule? No. In Dick, the trusts were administered offshore in Jersey. The court looked through them to determine what the husband controlled and ordered him personally to pay. The court reaches the person, not the trust.
What makes a court treat assets held by others as mine? Whether the people holding them could be expected to act at your behest. In Dick, that was his former trust company’s employees, his brother-in-law, and his business associates. In Berman, it was his wife.
Can an asset protection trust protect me from a divorce, spousal support, or child support? No. Community property is already partly your spouse’s, most DAPT statutes expressly carve out spouses and child support, and California courts look through structures built to avoid support — Dick ordered $35,000 a month in spousal support despite offshore trusts, and Berman imputed income from a business transferred to a new wife. Going offshore doesn’t help: in Harnack, the trustee refused to repatriate and the husband was jailed for contempt anyway.
What actually protects assets for a California resident? Jurisdiction, independence, and timing. Protection has to sit in a legal system built to resist U.S. creditor enforcement, be held by people who will not act at your behest, and be in place — for a legitimate purpose — before a claim is foreseeable.
The Takeaway
California has effectively closed the door on self-settled domestic asset protection trusts. Between Probate Code §15304, Sheean (1936), Nelson (1949), Marriage of Dick (1993), In re Moses (9th Cir. 1999), In re Cutter (9th Cir. BAP 2008), Marriage of Berman (2017), and Huckaby (E.D. Cal. 2026), the rule is straightforward: if you can benefit from your own trust, so can your creditors — and if you built it to defraud them, a court can disregard it entirely.
And none of it is a tool against a spouse or a child. Asset protection defends your property from third parties. Courts treat any attempt to use it against property division, spousal support, or child support for exactly what it is.
Domestic-only structures, including out-of-state DAPT attempts, fail for the same reason. California courts apply California public policy regardless of where the entity or trust was formed.
And when the assets are held by people who will act at your behest, California will treat them as yours — wherever those people happen to sit.
The real solution is not more complicated paperwork. It is jurisdiction, independence, and timing — with a legitimate purpose behind all three.
I spent years on the plaintiff’s side of the table in Los Angeles and Orange County — running discovery, finding the seam, pulling structures apart. The California trusts that came apart in my hands came apart for the same reasons every time: the debtor still controlled what he claimed to have given away, or he built the thing after the claim was already in view. Neither is fixable once the lawsuit is filed.
You do not wait for the fire to buy insurance. The same rule applies to protecting wealth.
You don’t rise to the level of your income. You fall to the level of your legal structure.
Structure before stress.
📞 For a confidential legal consultation, contact Bradley Legal Corp. at (888) 773-9399, or complete the intake questionnaire at btblegal.com.
By: Brian T. Bradley, Esq. — Licensed in California; National Asset Protection Attorney
