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Freezing Assets

There are many different ways to freeze assets as part of a divorce case. However, the best way to freeze assets is to obtain a court order at the very outset of the case. In most places, assets can be frozen by obtaining a temporary restraining order or a preliminary injunction. This is often accomplished automatically by the filing of a complaint or a petition for divorce. More often, however, it is necessary to file an emergency petition for a restraining order or an injunction, or an Order to Show Cause seeking temporary restraints. These legal devices are aimed at maintaining the status quo—that is, preventing each spouse from removing property, bank funds, or other assets while the case is pending.

It is important to serve restraining orders and injunctions on all parties, persons, banks, brokers, agents, and other business representatives who may control the disposition of assets. A court order freezing bank accounts is no good if the bank never learns about it.

In order to obtain an order freezing assets, a court may require some evidence that there is a risk that the assets would be spent, diverted, re-named, transferred, converted, or dissipated, unless a restraining order is entered. The court may agree to freeze assets only for a limited period of time, forcing you to renew your request or to settle and distribute the assets prior to the expiration date. Sometimes, when assets are frozen, it becomes necessary to petition the court to “unfreeze” some portion of the assets in order to use them while the divorce is pending.

 

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