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Massachusetts Appeals Court Says Plaintiffs in Car Accident Suit Can Collect Damages Award from Negligent Driver’s Self-Settled Trust Fund

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There are many different types of issues that can arise in a Massachusetts car accident lawsuit – who is at fault, whether the plaintiff or a perhaps a third party are also to blame, whether a certain policy of insurance is applicable considering the particular facts giving rise to the cause of action.

Sometimes, the issue is not who is at fault or whether there is liability insurance available, but, rather, whether the defendant’s personal assets can be used to satisfy the judgment. Typically, this only happens when the defendant is either uninsured or underinsured.

However, when a particular defendant has significant wealth in addition to (or in lieu of) insurance coverage, it may be possible for the plaintiff(s) to attach the defendant’s personal assets. Of course, each case is unique and must be decided on its own merits.

Facts of the Case

In a recent case, the plaintiffs (a woman and her minor child) asserted a negligence claim against the defendant trust after the beneficiary of the trust allegedly caused a 2014 motor vehicle accident in which the plaintiffs were seriously injured. The beneficiary of the trust died in the collision. In their suit, the plaintiff sought a declaration that the assets of the trust were available to them to satisfy any damages award ordered by the trial court in the negligence action.

The beneficiary of the trust had been involved in a previous car wreck in 2001. That crash caused him to suffer a severe traumatic brain injury, and coguardians were appointed for him. The beneficiary’s wife later filed for divorce. Through his guardian, the beneficiary negotiated a separation agreement that contained a provision to the effect that the wife would transfer certain funds into an irrevocable spendthrift trust to provide for the needs of the beneficiary.

The trial court entered a declaratory judgment for the defendant trust on the issue of whether the plaintiffs could recover a judgment from the proceeds thereof. The plaintiffs appealed.

Decision of the Court

The Massachusetts Appeals Court reversed the lower court’s decision in the trust’s favor and ordered the lower tribunal to enter a new judgment declaring that the plaintiffs could reach the assets of the trust to satisfy any personal injury judgment that they obtain in the underlying negligence case. The court so held because it found that the trust was self-settled insomuch as the beneficiary’s spouse transferred funds into the trust for the purpose of satisfying her obligations to the beneficiary related to the dissolution of their marriage. The court noted that the principal and interest available to the beneficiary during his lifetime will now be available to the plaintiffs to satisfy any judgment in their personal injury case.

An Experienced Injury Attorney Serving Cape Cod

At the Law Offices of John C. Manoog, III, we work very hard to see that our Cape Cod car accident clients get every penny of compensation to which they are entitled. Depending on the situation, this may include the defendant’s liability insurance, the plaintiff’s uninsured/underinsured motorist coverage, and/or liquidation of a negligent defendant’s personal assets. To talk to an attorney about the details of your case, call us at 888-262-6664. We serve all of Plymouth, Hyannis, and the surrounding area.

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