Your trust's law stops at the border of the land it holds

A trust's governing law protects its assets only where a court agrees to apply that law. In March 2026 the Eastern District of California showed what that means for a United States settlor who puts real estate into a self-settled trust. The trust was a Nevada spendthrift trust. The land was in California. The court accepted that Nevada law governs how the trust is construed. It held that whether a creditor can reach the land is a different question, answered by the law of where the land sits. It applied California law and held that the United States' judgment lien encumbered the settlor's interest.

The order is a district court decision, not appellate authority, and it turns on a narrow fact pattern. The point is still broader than the facts. Choosing a favourable jurisdiction for a trust does not move the creditor's remedy to that jurisdiction.

One caveat on sourcing. The court's docket is listed on govinfo, but we could not read the order's text, so the account below rests on law-firm commentary that quotes it. The commentaries agree on the holding but are not the order. They date it 2 March and 3 March 2026 respectively, and differ on the co-owner's first name. Anyone relying on the case should read the order. The federal statutes were read in full. The California statute is described from secondary sources and should be checked against the official text.

What the court decided

The case is *United States v. Huckaby*, No. 2:23-cv-00587, Eastern District of California. The defendants were Robert Huckaby and Joyce Tritsch. They bought the South Lake Tahoe house as joint tenants in 2005 and in 2011 moved it into the Circle H Bar T Trust, which they described as a Nevada spendthrift trust. They were its settlors, trustees and lifetime beneficiaries.

The United States held a judgment against Mr Huckaby, entered on 30 March 2018, for failure to honour Internal Revenue Service (IRS) levies. It sued in 2023 and asked the court to hold that its lien encumbered his one-half interest in the house. The court agreed that the judgment lien encumbers his one-half interest. It allowed the government to submit a proposed order of foreclosure.

The defendants argued that Nevada law should govern. The court agreed that Nevada law governs the construction of the trust, citing section 277 of the Restatement (Second) of Conflict of Laws. It then held that the live question was not construction but whether a creditor can reach the land, which under Restatement section 280 is decided by the law of the place where the land sits. California law therefore applied. Under California law a self-settled trust's spendthrift provisions are void against the settlor's creditors. Mr Huckaby was both trustee and beneficiary, so he held both legal and equitable interests, and had a property interest the lien could reach.

California Probate Code section 15304(a) is the rule behind that result: where a settlor is a beneficiary and the interest is subject to a transfer restraint, the restraint is invalid against the settlor's creditors. The trust is not void as a whole. Only the restraint fails. Subdivision (b) limits what a creditor can reach to the most the trustee could pay the settlor, capped at the settlor's own contribution to the trust. The commentary does not say whether the court discussed section 15304 by number.

The lien arrived by federal statute, not by the trust's rules

Title 28 of the United States Code (U.S.C.), section 3201(a), provides that a judgment in a civil action creates a lien on all real property of the judgment debtor once a certified copy of the abstract of judgment is filed in the manner of a tax lien notice. The lien secures the amount needed to satisfy the judgment, including costs and interest.

Section 3201(c)(1) makes the lien effective for 20 years unless satisfied. Section 3201(c)(2) allows one renewal for a further 20 years. The notice of renewal must be filed before the 20 years expire, and the court must approve it.

Take the 2018 judgment. If the abstract was filed in 2018, the lien would run to 2038 and could be renewed to 2058. We do not know the filing date, so those years illustrate how the clock works. They are not a finding about this case.

Enforcement follows section 3202. Subsection (a) allows a judgment to be enforced by the remedies in that subchapter. Subsection (e) allows property to be sold by judicial or execution sale, but not before a hearing the debtor has requested.

Section 3003(b) provides that the federal debt-collection chapter does not curtail the United States' rights under other federal or State law. It lists those rights, which include collecting taxes, seeking a receiver and enforcing a security agreement. This paragraph is our reading of the statutes. We have no indication the court discussed these provisions.

A worked example with the numbers moved

Take a hypothetical. A California resident holds a $1,200,000 house as a joint tenant with a spouse and moves it into a self-settled trust governed by Nevada law. Each holds one half, so the settlor's interest is worth $600,000. A creditor later obtains a $250,000 federal judgment and files the abstract.

On the Huckaby reasoning, the creditor's reach is tested under California law. California Probate Code section 15304(a) disregards the spendthrift restraint against the settlor's creditors. The lien attaches to the $600,000 interest and secures the $250,000 judgment plus costs and interest. Section 15304(b) caps the reach at the settlor's own contribution, which here is that same $600,000 half. The spouse's half is untouched.

A court can order a sale of the settlor's interest. A buyer of a one-half interest in a house is a poor market, so the realised price is likely to sit below $600,000. That discount is a practical point, not a holding.

Now move the house to a state whose law protects self-settled trusts, and keep the settlor resident in California. If the land's law decides, the result could differ. That is an inference from the reasoning. The case does not test it.

What the ruling does not decide

It does not decide that all domestic asset protection trusts fail. The reports describe a California property and a trust with no Nevada trust company as trustee. One commentary suggests the result might differ if the trust held the property through an LLC, and calls that possible but not necessarily probable. That is untested.

It does not decide anything about offshore trusts or hybrid structures. The case involved no foreign trustee and no foreign asset. It would be wrong to read it as a point for or against offshore structures. A foreign trustee raises different questions, including whether a US court can compel a US-resident settlor to repatriate assets.

It does not set a binding rule beyond its district. Another court could apply the law of the trust's forum, or a different conflicts test. How far other courts follow the land's law is an open question.

Where the exposure sits for a US-resident settlor

The practical sequence matters. A trust's governing-law clause answers how the instrument is read. The creditor's remedy is a separate question, and for real estate the land's law is likely to answer it. A settlor who is also a beneficiary has given the creditor an interest to attach, and the law of the land decides whether the restraint holds.

For clients who are US residents holding US land, two things follow.

• The jurisdiction of the trust does not move the land. California real estate sits under California law whichever state's trust holds it.
• Self-settlement is the weak point. Where the settlor can benefit, the land's law may disregard the spendthrift restraint against that settlor's creditors.

Anyone holding US land through a self-settled trust should have a US trusts and estates lawyer qualified in the state where the land sits review it, because that state's rule decides the outcome. HPT Group does not give US legal advice. Whether a different structure achieves the client's actual aim, for instance one where the settlor is not a beneficiary, is a question for that lawyer, and no structure removes the risk of a creditor challenge.