In U.S. v. Huckaby, 2026 WL 587784 (E.D. Cal., March 3, 2026), the United States government (hereinafter referred to as the “Plaintiff”) attempted to enforce a federal judgment against Robert Huckaby (hereinafter referred to as the “Defendant”) for failing to honor a levy by the Internal Revenue Service.
By way of background, in 2005, Defendant and Joyce Tritsch (hereinafter referred to as “Tritsch”) acquired a parcel of land in South Lake Tahoe, California (the “Property”) as joint tenants. In 2011, Defendant and Tritsch created the Circle H Bar Trust (the “Trust”) pursuant to the laws of the State of Nevada. Defendant and Tritsch were the Trust’s settlors, trustees and beneficiaries (i.e., a self-settled trust). Defendant and Tritsch thereafter transferred title to the Property from their joint names into the Trust. In 2018, a judgment was entered in favor of Plaintiff and against Defendant. As of June 2025, Defendant had not satisfied the judgment and owed Plaintiff approximately $88,000.
In 2023, Plaintiff initiated a civil action against Defendant seeking the following declaratory relief: (a) that Plaintiff may enforce its judgment against the Property; (b) that Defendant and Tritsch, as Trustees of the Trust, hold title to the Property as alter-egos or nominees in their individual capacities; and (c) the transfer of the Property to the Trust is void. Plaintiff further sought an order enforcing a judgment lien against the Property. In 2025, Plaintiff filed a motion for summary judgment seeking the following: (a) that Defendant and Tritsch were the Property’s true owners as joint tenants; (b) that Plaintiff’s 2018 judgment lien encumbered Defendant’s one-half ownership interest in the Property; and (c) Plaintiff may submit a proposed order of foreclosure on the Property.
The United States District Court for the Eastern District of California (hereinafter referred to as the “Court”) first determined what law should govern the matter of whether a creditor could reach property that is held in trust. Plaintiff asserted that California law governed the Trust because the Property was located in the State of California. Defendant countered that the Trust should be governed by Nevada law because Nevada was the Trust’s applicable law.
The Court ruled that to the extent Defendant argued that the Trust should be construed in accordance with Nevada law, he was correct. Section 277 of the Restatement (Second) Conflict of Laws states that a “[trust] of an interest in land is construed in accordance with the rules of construction of the state designated for this purpose in the instrument.” That being said, the issue before the Court was not a matter of Trust interpretation, but instead whether the land which is held in such trust can be reached by Plaintiff as a creditor. To answer this question, the Court looked to Section 280 of the Restatement (Second) Conflicts of Law which states that “[w]hether the interest of a beneficiary of a trust of an interest in land is assignable by him and can be reached by his creditors, is determined by the law that would be applied by the courts of the situs.” As such, the Court ruled that as the Property was located in California, the court would apply California law in its determination as to whether it is subject to the enforcement of a judgment lien by Plaintiff.
The Court then addressed whether Defendant had a property interest in the Property. Plaintiff argued that Defendant did, in fact, have a property interest because he was a beneficiary and a trustee of the Trust. Defendant argued that he did not have a property interest in the Property because a trustee does not hold property except as authorized by the trust instrument.
Basic trust law holds that property ownership is bifurcated when property is owned by a trust. The trustee holds “legal title” to the property while the beneficiary holds “equitable title” to such property. As Defendant was the trustee and beneficiary, he possessed both “legal” and “equitable” title to the Property. Therefore, the Court appropriately ruled that Defendant had a property interest in the Property and that the judgment lien could be enforced.
As a result, the Court held: (a) Plaintiff’s lien encumbered Defendant’s one-half ownership interest in the Property; and (b) Plaintiff could submit a proposed order of foreclosure with regard to the Property.
There are two main items to take away from Huckaby. First and foremost, a settlor/beneficiary should never serve as a trustee of a Nevada asset protection trust unless they understand the risks.
Second, California law does not permit the settlor of a spendthrift trust to also be designated as a beneficiary of such trust. In fact, California law voids self-settled trusts to prevent individuals from placing their property beyond the reach of their creditors. As the Trust was formed by Defendant and Tritsch and as they served as trustees and beneficiaries, according to California law, the Property could not be protected from Defendant’s creditor (Plaintiff). Nevada, on the other hand, is one of 21 states that currently allow an individual to create a trust, be designated as a beneficiary of the trust, and have such assets owned by that trust protected from potential creditors. Therefore, as soon as the Court held that California law would apply, Defendant’s day was not going to end well.
Although nothing would appear to be able to assist Defendant based upon the bad facts of this case, going forward, careful consideration should be given as to whether the Trust should have directly owned the Property, or whether it would have been more advantageous to instead have a limited liability company (wholly owned by the Trust) own the Property. As seen in Huckaby, real estate is more susceptible to attachment by a creditor if the court does not respect a trust’s ownership of such property.
Nevertheless, query whether an underlying limited liability company (100% owned by the Trust) owned the Property may have changed the Court’s opinion? The use of a limited liability company to hold real estate may increase the likelihood that a court will recognize a trust’s governing law in a litigation action against the trust. Most states recognize the ownership of limited liability company interests as personal property interests and apply the governing law of the ultimate owner of those interests (i.e., the Trust, whose governing law is the law of Nevada). When the Trust holds direct title to real property interests, many courts will apply the laws of the jurisdiction where the real property is located, thereby allowing possible foreclosure of such real property interests. Therefore, it is possible (maybe not probable, but at least possible) that the Court may have reached a different decision in this scenario.
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