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In re Lawrence

United States Court of Appeals for the Eleventh Circuit
279 F.3d 1294 (2002)


Facts

Stephan Jay Lawrence created an offshore asset protection trust in Mauritius and funded it with $7 million. Two months later he lost an arbitration proceeding involving securities law and was assessed damages of $20.4 million. He then filed for bankruptcy and the bankruptcy court ordered him to turn over the offshore trust assets to the bankruptcy trustee. The offshore trust contained a duress provision that terminated his rights as beneficiary of the trust in the event that he filed bankruptcy. The terms of the trust also provided that Lawrence had the right to appoint new trustees and that the trustees had the power to reinstate Lawrence as a beneficiary. When Lawrence failed to comply with the court’s order, the court held him in contempt and ordered him taken into custody until he complied with the order. Lawrence appealed the contempt order arguing that the duress provision made it impossible for him to comply with the court’s order because he had no power over the trust after his rights as beneficiary were terminated.

Rule of Law

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Issue

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Holding and Reasoning (Politz, J.)

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  • A “yes” or “no” answer to the question framed in the issue section;
  • A summary of the majority or plurality opinion, using the CREAC method; and
  • The procedural disposition (e.g. reversed and remanded, affirmed, etc.).

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