Legal Question in Real Estate Law in Alaska

Re: Felons with business & real property

I'm not an Alaska-licensed attorney and cannot give you specific legal advice, but the principles are fairly standard from state to state, so perhaps I can be helpful with a very general discussion.

There is a law that has been adopted in most states, with slight variation from state to state, called the Uniform Fraudulent Transfer Act. It says that a transfer of property can be a fraud on creditors if (A) it was made with the intent to "hinder, defraud or delay" a present or prospective creditor of the transferor; or (B) was made for less than fair value while the transferor was insolvent or rendered insolvent thereby, and had the effect, intended or not, of making life tougher for the creditor or potential creditor.

So, that's a pretty sweeping definition. However, on first blush it does not seem to catch all possible transactions in its net.

First, a transaction for fair market value is not fraudulent per se under the UFTA. If you sold the mine, the rig, the boat or the lodge to your brother-in-law for 40% of appraisal, that's suspicious; but if you sold through a third-party broker for the best he could get in an arm's-length transaction, and didn't take the proceeds in Krugerrands or unmarked Euros, that's probably OK.

Next, you are innocent until proven guilty. (Ponder that maxim while sitting in custody awaiting trial!) If there is a pressing need to attach business assets pending outcome of trial, the prosecution will know what to do to get a writ of attachment or some kind of restraining order. If the business is unconnected with the alleged crime, the attempt may fail.

Since a proprietor and his business are one and the same at law, the business assets will be treated no differently than the defendant's other assets pending trial, unless the business assets have particular importance to the case, e.g. as evidence or because the charges involve the business directly.

In most states, a partnership is an entity, separate and distinct from the partners as individuals, and partnership property is not liable for the debts of an individual partner not contracted in the course and scope of the partnership's business.

Keep in mind that there is a huge difference between LEGAL ability to sell and MARKETPLACE ability to sell. You may be under no legal constraint, but buyer apprehension may result in no decent offers being received.

For real advice, contact and retain an Alaska attorney.