Thursday, February 15, 2007
The Iowa Supreme Court reviewed a property division in an unusual case involving a couple who, during their 10-year marriage, built up a business together with assets of over ten million dollars, but who kept all the business assets in wife's name to protect them from creditors. The trial court had ordered that wife be granted the business assets but that she make payments to her ex husband over a period of years, with each payment to become a judgment when due. The court granted husband an equitable lien on the company to secure these payments.
However, the Iowa Supreme Court found the trial court's approach to leave husband with too little protection. First, the court found that the trial court should have issued a judgement for the entire amount, with an allowance of periodic payments, so that a judgment lien would attach to the business's real property. Second, it found the trial court's refusal to assess interest on the judgment to be in error. Finally, it reversed the grant of the equitable lien, finding a combination of a judgment lien and a UCC lien to be the best combination of protections for the ex husband.
In re Keener, 2007 Iowa Sup. LEXIS 13 (February 9, 2007)
Opinion on web (last visited February 11, 2007 bgf)