Can A Divorce Shield The Assets Of Derek Chauvin From Civil Lawsuits? Not Necessarily.

200529-derek-chauvin-mug-inline-ac-947p_8d9dd7099ef74c31fea0f3779d824fb9.fit-720wKellie Chauvin, the wife of former Minneapolis police officer Derek Chauvin, has announced that she is filing for divorce after 10 years of marriage.  In her statement, she expresses sympathy for the family of George Floyd.  There is no evidence that this is a tactic to shield assets from the inevitable civil lawsuit against the estate of Chauvin.  However, it is a question that often comes up with clients that I dealt with on both civil and criminal cases.  When faced with potential of civil liability, some clients raise the possibility of shielding their assets by transferring them or seeking a divorce.  Such maneuvers often do not work for a variety of legal and practical reasons.

Once again, Kellie Chauvin has not shown or stated any such intention. A public statement declared:

“Her utmost sympathy lies with [Floyd’s] family, with his loved ones and with everyone who is grieving this tragedy. While Ms. Chauvin has no children from her current marriage, she respectfully requests that her children, her elder parents, and her extended family be given safety and privacy during this difficult time.”

There are also other reasons (beyond incompatibility or asset protection) that some clients consider divorce in high-profile cases. The most common is that a defendant wants to shield his family for hatred and abuse.  A divorce can seem like abandonment but it is often preferred by a defendant who does not want to see his or her spouse (or children) face public ridicule or abuse.  In this case, it is likely that the Chauvins will not be living with each other any time soon, or perhaps never again.  A divorce can reflect that reality in trying to shield not assets but family members. (The Chauvins do not have children).

Now to the legal question of whether estate assets can be shielded through transfers or divorce.  Courts have flagged transfers or divorces that appear opportunistic or strategic in anticipation of liability.  One such case comes from Minnesota where this issue could play out in the court. The 2014 case is Citizens State Bank Norwood Young America v. Gordon Brown and the Minnesota Supreme Court faced a divorce of a couple of 23 years. Notably, the husband under the divorce was assigned all of the debt while his wife was awarded most of the liquid assets. They continued to live together.

When the Bank was awarded a default judgment against the husband in June 2010, it found it difficult to collect and by October 2010 the divorce was final. The bank went after the assets of the wife and relied upon the Minnesota Uniform Fraudulent Transfers Act (MUFTA). MUFTA is designed to prevent the removal of asserts to avoid payments under liability judgments.

MUFTA is not a new concept. Minnesota’s territorial legislature enacted an early such law in 1851.  See Minn. Rev. Terr. Stat., ch. 64 (1851) (covering “[e]very conveyance ․ made with the intent to hinder, delay or defraud creditors ․ shall be void.”).

The law contains “badges of fraud” to courts to apply in deciding whether a transfer was fraudulent. Section 513.44(a)(1) provides that “[a] transfer made or obligation incurred by a debtor is fraudulent as to a creditor ․ if the debtor made the transfer with actual intent to hinder, delay, or defraud any creditor.” A “transfer” is defined as “every mode, direct or indirect, absolute or conditional, voluntary or involuntary, of disposing of or parting with an asset.” Minn.Stat. § 513.41(12).

The Court ruled that “[t]he presence of several badges of fraud, however, creates an inference of fraud that requires clear evidence of a legitimate purpose to rebut” and “[t]he Browns have failed to rebut this inference.”

Other states have also applied such laws to divorce proceedings.   See Enlow v. Enlow, 352 Ga. App. 865, 868 (2019); Canty v. Otto, 304 Conn. 546, 558 (II) (41 A3d 280) (2012); RES-GA Lake Shadow v. Kennedy, 227 S3d 522, 527 (Ala. Civ. App. 2017); Estes v. Titus, 481 Mich. 573, 592, 751 N.W.2d 493 (V) (751 NW2d 493) (2008) (Michigan); Fadel v. El-Tobgy, 245 Ore. App. 696, 705 (264 P3d 150) (2011); Kardynalski v. Fisher, 135 Ill. App. 3d 643, 651 (482 NE2d 117, 90 Ill. Dec. 410) (1985).

In California, the court in Mejia v. Reed, 31 Cal. 4th 657, 668-669, 3 Cal. Rptr. 3d 390, 74 P.3d 166 (II) (D) (74 P3d 166) (2003)  ruled that “[California’s] UFTA applies to property transfers under [marriage settlement agreements]” and “[i]n view of [the] overall policy of protecting creditors, it is unlikely that the Legislature intended to grant married couples a one-time-only opportunity to defraud creditors by including the fraudulent transfer in [a marriage settlement agreement].”

These cases can present difficult questions as a court tries to determine if the divorce was based on substantive rather than strategic motives.  Some cases like that of the Browns in Minnesota are easier due to such facts as the couple continuing live together. That will not be the case with the Chauvins since Derek Chauvin is in jail and will likely remain there.  However, if the family sues, they could raise this issue to seek assets from Kellie Chauvin.

Little is known about the assets of the estate or Kellie Chauvin’s personal wealth. She was born in Laos and came to the United States in 1977 at age three.  She was crowned as Mrs. Minnesota in 2018. 

If the estate has limited assets, Derek Chauvin may decide that he is better off with a public defender since he would quickly exhaust his assets anyway.

Minnesota is a no fault jurisdiction so the case can move more quickly, particularly if there is no dispute on the dissolution of assets. However, a one-sided dissolution as with the Browns can itself be an indicator of fraud.

 

148 thoughts on “Can A Divorce Shield The Assets Of Derek Chauvin From Civil Lawsuits? Not Necessarily.”

  1. Good time to protect against being sued (to the degree it’s possible).

    Also a really, really good time to not be named Chauvin.

    Even more, also a great time to realize, when seeing the footage of your husband kneeling on a man’s neck for almost ten minutes with a blank look on his face and his hands in his pockets, that you’re married to a monster. In which case divorce is certainly an appropriate answer well above and beyond strictly financial considerations.

    1. Hellvis – what is worse is the looks on the faces of the officers after Floyd is put on the stretcher an they go back to their cars. It is like they just put out the trash.

    2. I’ve seen em use that technique in a USA prison video come to think of it, to take out a prisoner.
      Was 5 or 6 of em (guards or whatever officials)- and the guy knew they were taking him to kill him. Marched him through some hallways and this and that bar door – audio included – he’s saying don’t do this.. etc.. they get to a small room with a bench alongside one wall then all pounce on him…a some minutes later he’s dead.

  2. The wife was a radiologist; they met when the cop brought a prisoner to the hospital. They dated and married. She left the medical field and began selling real estate, specializing in representing other Laotian immigrants. Presumably her real estate career pays more than radiology, so she has assets. They have a very attractive home that was the target of protesters. I understand her wanting to protect her assets, children (by a prior marriage) and parents, but dumping her husband like yesterday’s leftovers seems cold. I assume she’ll move on and find a third husband. It reminds me of when I was in the Air Force and some airmen would marry Asian women despite all the hassles of language, culture, immigration issues and so forth. The reason they always gave was that Asian women were “loyal” and wouldn’t leave them, unlike Americans. Of course, that stereotype was ridiculous. Lots of these women just wanted to get themselves and their families to the U.S., and once here, went on a credit card binge, running the poor sap into debt and then running off with the first guy they met with a fatter wallet. As a JAG officer, my job was to get these chumps divorced ASAP, but they were stuck with the debt and often demoted for failing to abide by military rules requiring servicemen to be financially responsible.

    1. They have a very attractive home that was the target of protesters.

      No, it’s a small tract house. About 1/2 the front facade is occupied by the garage door. There is one front facing window and a ratty looking chain-link fence around the oversized side yard. The street he lives on has no side walk and the setbacks are excessive. He’s done no landscaping (maybe because he’s worked two jobs for 17 years). Great place if you like wasting your time cutting grass.

      He and this wife have no children. She brought children to the marriage. I’m wagering that given he was 34 when they married that he did as well. Not livin’ large on two incomes.

    2. Of course, that stereotype was ridiculous.

      No, it isn’t. American women are commonly untrustworthy.

      1. Is that ever the truth! I do a lot of domestic relations work for Penelope and HUGE numbers of women, particularly if they are > 36 years old are nutz! Sheer nutz! I tell our male clients that God has blessed them with a divorce and they simply do not know how happy they are going to be when it is all over.

        They don’t believe me at first, but as the process goes on, they come around.

        Squeeky Fromm
        Girl Reporter

        1. You think American women are untrustworthy, try one of those imported women from the mail-order bride websites! I’ve known a few saps who did that and got cleaned out financially. One of the lovely brides (HaHaHaHa) was from Russia; the other from the Philippines.

          1. Yeah, I’m sure women on mail-order bride sites are absolutely representative of the feminine spectrum in their countries.

            As it happens, a dear cousin of mine married a Chinese woman he met online. They’ve had 12 good years together with, one may hope, more to come for them and their children. Some women know how to spot an undervalued asset. Pity more of them aren’t Americans.

      1. I only “know” what I read and see, and a lot of what’s being posted may or may not be correct. The info I saw said she was a radiologist and the house looked quite nice, a fairly new Mediterranean style. But there was also info posted that was incorrect; that the Hmong cop was her brother! She is Laotian.

        1. The house is not a Mediterranean style anything. And she’s Hmong, not Lao. The woman was 26 when she divorced her first husband and had two children, so obviously she hadn’t been through a pre-medical program, medical school, internship, residency, and fellowship. You just cannot get it right, can you?

  3. I doubt Derek Chauvin has extensive assets. It is certainly possible that Kellie Chauvin divorced him over his behavior in the video. None of us have any idea what Chauvin is like at home, if this was the last straw, totally out of character, or what. Or she could be abandoning him because the writing is on the wall, and they will lose every cent to lawyer fees and settlements. Or perhaps he urged her to divorce him out of a protective instinct. It’s all conjecture.

    All I know about Kellie Chauvin is that she has children from a previous relationship. If she is not a woman of means, I don’t expect her to starve, during a pandemic, in order to wring every dime to give to a wrongful death lawsuit. The man is charged with murder. He will likely drain every penny paying for a lawyer. He has been fired, and has no income that I know of. I do not know how he is going to help maintain his ex-wife, nor do I know if she’s working, or if she’s lost a job during the pandemic.

    I don’t believe in punishing innocent people. Chauvin is responsible for his own actions. Not his wife, her kids, her relatives, or his relatives.

    1. For richer for poorer in sickness in health… unless it’s inconvenient for Karen.

      1. No indication she’s a so-called “Karen,” what Black Twitter has identified as an entitled, fussy, middle-class white woman. She didn’t create this situation, but she’s trying to bail from it as quickly as she can. Her name is Kelli Xiong Chauvin and she’s an Asian-American. It doesn’t appear to me that she takes her marriage vows very seriously, and she competed in the “Mrs. Minnesota” contest so she may be somewhat vain, but other than that she’s a seemingly financially successful real estate saleswoman.

        1. The previous poster signs herself ‘Karen”. Every time.

          I don’t give a rip what Mrs. Chauvin’s actual name is.

    2. None of us have any idea what Chauvin is like at home, if this was the last straw, totally out of character, or what.

      We don’t have any idea what she’s like, but you’re not above making assumptions.

      By the way, Karen, she was divorced in 2001. Her children are 20-somethings.

  4. His was a monumentally counterproductive thesis to say the least.

    It was bizarre that he would want to commit this murderous act.

    It is incomprehensible that he imagined that he was going to get away with it.

    Who wants to spend their life in a prison cell, if they are lucky enough to retain that life?

    Suicide by cop?

    1. It wasn’t a murderous act, he was just doing what he always did, unfortunately this time it didn’t work out. Possibly due to underlying medical conditions or some toxic substances. Cops are not EMTs but Floyd’s refusal to enter the police vehicle was not a wise choice. The initial autopsy does not list strangulation as the proximate cause of death likely a contributing factor though.

      1. The perp stated on video that he could not breath and breathing must have been accommodated. It was a bizarrely murderous act – on video – would you prefer that viewers believe their “lyin’ eyes” or you?

        1. I agree. I didn’t come across a full vid until yesterday. Daily Mall 5:38
          I just went to some other link for the beauty queen soon to be ex and they had a large pic of the neck kneel.
          You look at it and you just go …. (pick your expression of disgusted disbelief).

          I don’t know what the heck is wrong with people nowadays. Defending that after watching the video with sound is an exercise in futility.

          I stopped the vid after the guy went limp and the knee gimp immediately pulled his mace, anticipating a violent reaction from the onlookers.

  5. He’s a dork. He’s a dork!
    He’s a dork all the way.
    Send him to hell in his last breathing day.
    Choke him to death.
    And pee on his face.
    He’s a disgrace to the pigs ugly face.

    1. Kellie Chauvin reminds me of Barbara Bush: an otherwise nice, innocent lady who just happened to be married to a cold blooded murderer.

  6. I doubt the MPD is going to defend her when he is sued, so I think getting out the door is the right thing.

    1. Aw…boo.
      Maybe the AI bots stole it and don’t want you getting credit.
      Seth, hello? Lurking the thread ? Conspiracy or not a conspiracy ?

  7. I sent the video tape to The Pearly Gates. When this beast dies and gets his interview Saint Peter will be able to inquire as to why he had his knee on the humans neck for so long.
    They will cut his head off, send it to Hell and burn his body.

    1. And he apparently worked two jobs for a lot of years — though I don’t know how many hours he worked at the club.

  8. Well I think she’s a coward with a peculiar take on her wedding vows but if she’s really interested in shielding assets she ought to do transfers now for value and just liquidate. Cash is harder to trace and can be spent up until judgment. Thereafter she can make her whereabouts outside of Minnesota.

    1. She’s a girl, exercising her absolute right to change her mind (and, in the ‘minds’ of some, her absolute right to be free of any criticism for the choices she makes any time, any place, and anywhere).

      Three young men in our circle of relations have (in the last 10 years) been abandoned by their wives. Two of these women were sleeping with other men at the time they left (and there is reason to believe the third one was as well). All of these men were employed in satisfactory petit bourgeois jobs at the time they were given the gate and none of them have a history of emotional or behavioral problems (bar that one, about 7-8 years before he was married, went through a period of binge drinking). None of them were cheating. The quondam in-laws of one of these men still keep track of him on Fakebook; his father-in-law had more influence on his career trajectory than his father ever did. You know how people react to this sort of thing? (1) They treat it as a weather event or (2) They say each of them must have been a ‘cr!p partner’ (definition not supplied), because no one would do this without a good reason. Response (1) manifests the flat-souled quality of this age. Response (2) mixes stupidity with asininity.

      People like this bozo

      https://claremontreviewofbooks.com/wimps-and-barbarians-the-sons-of-murphy-brown/

      have no clue.

      1. Fantastic article! I loved this part:
        ———-
        Least of all will parents spank their sons; if you suggest that they should, they look at you in horror, for after all, “violence only breeds violence.” Of course, this softer form of discipline does not really work. When “time-outs” and restricted use of the internet prove unavailing, then it is time for counseling and Ritalin.

        The old form of discipline was quick, direct, clear-cut, and effective. The new non-punitive discipline is time-consuming, indirect, muddled, and ineffective. Every breaking of the rules requires a long discussion in which the boy gets to express his “feelings” and therefore make his case. This new form of easy discipline actually compromises the boy’s moral growth in several ways. First, he receives no real punishment for wrongdoing and is not made to feel shame. The absence of these traditional external and internal sanctions inhibits his development of self-control. Second, rather than truly learning to be responsible and to accept the real consequences of his actions, he learns to be litigious and whiny. Worst of all, to the extent his father is involved in all this nonsense, he sees the man who should be his master and mentor not as an authoritative figure who imposes order and dispenses justice but as a craven coddler who shudders to injure an errant boy’s self-esteem. On the surface, the boy is glad to skim by without getting into too much trouble. Deep down, he knows that his father is no man and so looks abroad for more energetic examples of thumotic manhood.
        ——-
        Our best hope for the long term survival of the United States, and the West, is that Asians degenerate as quickly as we did.

        Squeeky Fromm
        Girl Reporter

      2. Some smart person I know put it best “women have choices, men have responsibilities.” She bailed pure and simple —as many second wives do for a melange of selfish reasons.

        1. It’s Dr. Helen Smith’s summary of contemporary feminism. “Women have options, men have obligations”.

              1. It appears Absurd is flumoxed on the shrinking and geriatric white guy make up of the GOP as well.

      3. Friends were married and always seemed happy together, we always had good travel no problems. A couple years later I encounter her Mother. She’s telling me her daughter left the marriage and she just can’t understand it. Thinks something is wrong with her. He’s a good provider (architect)…etc.
        Yep, the Mother’s don’t even get it. At least some don’t.

    2. Mespo: One would have hoped that she had the decency to offer some support to her husband of 12 years, even if she divorces him later. He’s on suicide watch with check-ins every 15 minutes. She could have issued a statement that this was a horrible tragedy and she doesn’t believe her husband had any intent to kill Mr. Floyd. There were three other cops there and nobody intervened or in any way suggested that what he was doing was not authorized police procedure. Just yesterday the Daily Mail had a photo of an NYPD officer kneeling on the neck of a suspect. The photo was taken Fri or Sat, following the death of George Floyd and the riots in Minn, yet this cop was still using the very same procedure!! And BTW, it was a black cop with a Spanish name (Dominican?) and a black subject, so no outrage.

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