honour's john birch on behalf of mr winship and the winches living trust me advised starting with the finality of finality as in this case has been going on a long time but the central issue in this case i know it kind of i mean it in many ways don't i but let's talk about more specifically whether we have jurisdiction here and you know oh sure it's a very serious issue for all three of us as we explained in our october st letter and chase does as well i'm it's well recognized even in the circuit that when you have a judgment that resolves all issues assets in a collection effort you have a final order that this court has full jurisdiction to hear and what every call action order the appeal potentially yes that doesn't happen very often but it well might happen more often than you think but why then if every orders appealable the converse is also true if you don't appeal your way right so potentially in a large action where there's if you sought to collect and get a car for example only one case where there's a possibility of many garnishment so many charging orders that's why he's this is a really important point if there's one hundred of them it really cuts both ways that's why this is so hard to me on the one hand if there are one hundred dollars of them and  we have an appeal for every one of them on the other hand what supports you is if there's one hundred of them over ten years we have to wait to one hundred so i'm saying something that cuts in both directions but yes if you're some to grips with his point that were you supposed to appeal every one of them we have in this case in this case of all cases we want every appeal of every garnish your honors its because these charging orders in the form that they were approved by the district court are life and death for this case because mr needs the distributions from those elsie's to pay the personal taxes that he owes on the l l c income wrong as a matter of law because i looked at that and the taxes cannot be taken so the taxes he keeps and then the profits go well i don't think that's correct so he's got twenty six dollars us c six hundred and seventy four dollars said they obligation to pay the taxes chase's position is that they've got the right to take everything that is in the trust that it's the  the charging orders were upheld yes as granting chase the the priority with regard to each l l c they have priority i think they would i mean they they would supersede the i absolutely ok you think not so the idea is what are the distributions what are they what rough amount are they conned there are millions of dollars so like ten million dollars of dispute yes ok so five goes was gather many of those millions would go to the federal government and some would go to him and the but that you are not to i'm not trying to get at who's making the point your theory is that chase could get all five million yes and therefore how does he pay taxes without anything correct and it's not my theory that's their theory doesn't the government have a doesn't the government always trump in other words the i r s there's some probably some legal vehicle by which i or i or a skits it's do despite chase that's a question that gets right to the root of this appeal that's why the district court and chase are run because the tax obligation is a personal obligation of mr wynn germany because i'm ok i understand we don't want to we don't want to go there for what it's worth you can keep trying to push us there but we were so interested in figuring out the finality so i'm trying to keep calling you back that it has to be final look i understand your concern i guess i have a number of related issues which is if it's so important why can't you see can interact with tory to peel why can't you seek a fifty four b why can't you seek mandamus if the district court won't participate in that and then i still have this final question i hate to even throw it in is i is i understand the law it really should tell me and point me to why the government doesn't come st the government always comes the government always comes st monitor chase's view of the world those assets in the garnish the government yes and i have and chase that position the reason i say this is because this is what the district court held this is what we're up for an appeal said that those assets those distributions belong to the trust and the trustee not to mr a lot of money here this could take a long time it would so it's ten years it seems weird to say you have to wait till the end that supports your position yes but it seems weird to say you have to appeal every one of the why she lose your right so w a fifty for certification quite a nice solution to sort out what's a really important point that's where you both want want to resolve this right if we're talking about a certification or mandamus which by the way both parties didn't think was necessary because they thought this was a find out what happens that but you know those still leave everything up to the discretion of an appellate court whether to take a jury so so what would anyone have both of you can only answer for your client but you know we have this indicative ruling concept there's there's an addictive ruling provision in the district court there's one in the court of appeals and what the court of appeals can do is kind of an opportunity to communicate at a time where the district court may think it doesn't have authority so the district court probably thinks it does not have a have to issue a jurisdictional ruling and what's a very complicated case and then boom you know all of a sudden taxes can't be paid in the month no wait stop he says no we don't have to decide whether there is finality but in that way you avoid having to deal with a very hard issue potentially and i don't know why he would say no this seems like so central do you think he's enjoying this i certainly hope not we're not enjoying this i would say if you really thrilled to figure out the answer to this that enjoy it if you were going to ask for  have ruling then i would respectfully ask that you also clarify in any such order that these charges orders are not in forcible until the appellate validity in the village of these on appeal has been determined because otherwise they're able to take all these miles in with the district courts request that you post bond i mean this happened with me when i was on the dischord all the time and bond was a common thing that was posted ok it takes the risk out you don't ever ask what they don't ever ask and then judge sutton's proposal seems perfectly reasonable why would that take more than a week the ticket of ruling approach take more than a week nothing in this case is taken a week everything in this take place takes months and years and when you've got circuit authority joseph hughes that says that a final order on a collection matter is something where you've got appellate jurisdiction then i don't see why you walk away from god which now mandaeans order in this very case that said until all the post judgement proceedings completed there is no finality correct and that i don't think contemplated future disputes on particular instruments of execution but what we have is we have a lot of future dispute  we have a final judgement on the guarantee we have a final judgment in favor of chase and now we're in the collection let's see what is your wrong i'm still not following you what's wrong with just if you were so concerned that chase is such a bad actor why not post the bond you can he was willing to give you his day takes all the risk out which is a perfectly fair request by district court and then let's get the fifty four b and it could take a week you're right who knows it could take ten years but option of a very fast clarification that there's jurisdiction if it doesn't happen quickly do you really think we're going to sit on this will we have the opportunity to present our merits argument will you call us back to cincinnati for an argument in a month if cohen says yes i'm done with that you have jurisdiction because i think it's one maybe maybe not you're not entitled to anything more than anyone else but i mean presumably even if we don't want to call you back we could rule in the jurisdiction if we have jurisdiction then we could even set up a phone argument if we really needed argument briefings pretty good on this merits there are a couple of small points that i would like to press ok so we're not ever meeting well maybe we'll let you i think right now the number that chase wants to collect is a really big number huge number and i'm just trying to figure out at the current distribution schedule what are we talking about is that a couple year thing in other words you lose everything we do have  hypothetical question you lose everything on the argument you're making how long does this play out five years ten years one hundred years it could be a potentially a long time it depends on how long mr winge it would be able to use other assets to continue paying his taxes so let's just take the tax thing off the table yes ok let's assume there's a way to deal with that problem i was trying to figure out how long we're talking about of garnishment charging orders all the the distributions are going to come once a year to pay taxes a possibility of a do the math just cut to the chase what is the math what is the and i think for his life to be seven hundred and fifty million and seventy four ok i want only once he dies that's that well i think at that point then all of a sudden things start to change because now the trustee has an obligation to try to distribute assets to beneficiaries there's going to be sales chase is going to come in and they're going to claim that they're entitled to the sale proceeds and we won't know whether that's true or not because the merits of this case will not have been resolved reasonably at the elysees if there garnishment orders  outside the six circuit that would that would by definition suggest it's a different action i believe all the charging orders are here in michigan so they're all in the six circuit so ok so that's how to market it to my knowledge and i'm all right why don't you talk about the merits  points at the time that chase took the guarantee as well as one hundred and fifty million dollars pledged to secure it it also had more than seven hundred million dollars in guarantees and pledges from twenty other companies that mr winch it opened so it all there was eight hundred and fifty million dollars  collateral for a four hundred million dollars loan when there was the default chase so all those assets mr winship paid the fifty million dollars so the pledge went away everything should have been over but there was still a deficiency and so now what chase is asking you to do is to affirm a district court holding to give it what it did not get which is an unlimited pledge from mr winge it from the stuff that he owns individually so with that context keeping in mind that these i'm sorry what do you mean by an unlimited pledge it's a finite amount so i'm not sure what you're saying but the pledge has been discharged entirely chase's argument is that because the unlimited guarantee attaches to trust property and everything in the trust is trust property that therefore they've got an unlimited access to mr winges personal property it's as though he signed an unlimited pledge instead of one hundred and fifty million dollars pledged to help help me with this simple thing which cuts against you i thought the whole point of trusts is to take it outside of the ownership of the individual you know what's funny about the case is he has this fifty million dollars guarantee he makes a good guy and the assumption usually with trust is the whole point is so you have to pay taxes there's some other entity that controls it and that's what seems to be the promise of their argument in the district court's decision that doesn't seem crazy to me i thought that was the point of trusts in these other legal worlds with your argument that now they're into all his personal money judge that and judge cook that's true of an  nineteen of our brief says that very thing to settle it remains the owner and i thought about their kind of apocalyptic scenario that if you would reach that holding if you would agree with us that somehow that upsets the financial world and i thought well where's the situation where this would come up most often and it would be where you have the settler of a revocable trust who wants to get a mortgage on their house which is in the trust you know who does who owns that and so i look to fannie mae which tells the entire industry this is what the documents individually and as the trustee and chase knew how to do that because when it took the pledge the security it asked mr winship to sign individually as well as in his capacity as trust that if i think this is the most vocal trust in the world for practical this court's two thousand and fifteen ruling and why doesn't he we both get them and he tried and they accused him of doing a fraudulent transfer which the district court sustained and rather than appeal that because we wanted to give you guys a break we put everything back in the trust and fought about who owns those assets why not appeal that if you waived your right to appeal that we have not because it's in a locket area the fraudulent transfer proceeding has been stayed it's not final and that's a cross claim it's not consolidated with the claims in our case and so the finality of that portion of the case doesn't affect your jurisdiction in this case so the bottom line is strange though to be doing garnishment rulings before that's resolved doesn't matter and i'm missing something  plea because if this court rules in this case that mr lynch it only assets and that chase knew that that's why i got his personal signature on the pledge which was their security if you hold that then everything else is gone then there was no fraudulent transfer because he on the assets as he thought he did at the time he revoked it was that there's no collection wished in your view it is the st question and if you resolve it we will never be back here again they'll have an i'll have an unsecured judgment of guarantees and personal guarantee reason why the distribution you need to and in front of the government would chase have priority over the government for distributions for that the government wants for taxes yeah i think probably right i'm well let me put it this way your honor in this is be getting a little bit over my skis because i'm not a tax lawyer but i think the way it works with respect to l l c s is that the taxes on the distributions as opposed to on the income i think that income gets passed through back to in so i think the point is if mr burr said this they're just never going to pay distributions they're never going to make distributions out may be the case that there's an accumulation of retained earnings only distributions are taxed i believe that's just simple i thought there were tax garnishments your honor what you were allowed to garnish from the yellow sea as well as from the government so wrong about that again i don't want to represent myself as a tax lawyer here but i think the issue is what the status of the corporation is is it a c corp at which it's taxed at the corporate level or as an s corp at which so i get that my on my question assume the answer to that i was assuming and ask or i get the point that the members shareholders of the s corp are the ones that actually owe the tax obligation but my understanding was the norm was for the l l c even an escort setting to pay the government at that time to just make it easier i mean the whole point was to make it easier they didn't have to write they're not technically the one obligated but it was to make it easier so i was assuming this was a complicated point that you could have a garnishment or maybe chase would take the position we're not going to gosh ahead of the government we don't think that's a good play your honor i don't i don't know what we would do it 's frankly not an issue that has come up in the case i mean you know i'm reluctant to get too far ahead of this issue because your ultimate answer of how they pay is that's silly because they're just not going to distribute so there's no pay obligation anyway since you're already how else will he will he draw income well i know he has a lot of income but yes but still the idea in organizing his business interests one would be start diminishing the value of these cs by virtue of distributions right and you say there is no taxing in texas or only on distribution so that's the point he would perhaps expect to organize his his world by distributing again as i understand the law your honor at some point there may be sufficient retained earnings within the l l c that there would be a separate retained earnings tax but that's a different you know that would make sense to write it but but the how do you respond to judge the p to parse point is that if you want is it's own action if you don't appeal and distribution one your stock but the other side of that is what now we wait till the end it's all been distributed and now you're the fight is about whether to get overturned which is heist it just seems like a super complicated problem getting in figure that out it's a super complicated problem you're in or i think what i would say is a couple of things st of all there is a discrete sort of unit of issues with respect to the l c d s ok these are the only elsie's that are held in the trunk so just just give us a pass on the st one we'll take care most of the issues that's your basic well i think the point is when you're talking about a post judgment execution you know th the question is what's the right sort of judicial unit at which to assess the question of finality and here what we're saying is that there is a discrete fifteen l l c set of charges are we going to have this test that in every case i mean you're burying us in the back which i understand why you're doing it so it makes perfect sense from an advocate standpoint but i just look back at the prior opinion in this case were judge now banning instead and i can quote it or i can tell you that post judgment order he's not final until all the post judgment proceedings are completed and there's a logic to i agree with judge sutton it creates this kind of it's a really hard question i know that's what i heard of the judge that's what do you base thirty ultimate opinion on so it's a necessary reasoning to the holding but the the the question i have is the same one i asked the other side which judged and came up with a good solution it seems to me is why not a fifty four in our lock a tory worst case of mandamus why not try and that i know is a district judge it was a relief some time in fact we did ask and sometimes the six circuits say no we don't think it's important enough  district i just get how important it is especially if he's going to be doing this over ten years he wants to get the st one right and what's the objection to doing this through an indicative rule do you understand the addictive ruling concept just i don't your honor so the basic idea is there's these amendments to the civil and appealed and what this allows is the court of appeals in the district court to communicate so you can communicate back to the district court from the clerk's office saying would you grant a rule for fifty four certification if asked he communicates back said we sent it back for that limited purpose get the certification and this problem has gone away and we don't have to issue a ruling on it and it should take very little time it doesn't involve you all for what it's worth you don't get to brief on it  just us communicating with the district court i don't see the downside with that your honor i don't see the downside with it either except to make the following observation that mr wintered had the opportunity to file a mandamus or a fifty four b it's just solves a lot or at least sheds light so so yeah your point as a practical matter yes not going to want the same thing we want a ruling from this court that makes clear that our our that's so your honor just to say a few words about the merits this is a case here where this court has held that the trust in mr winship personally are separate and distinct michigan law you can have a revokable trust and then that law says that mr wang it owns the property well your honor here here's the key point though under even under revocable trust both the individual and he's the trustee here so it's right bit of an artificial concept but the reality is he entered into a valid and binding obligation on behalf of the trustee and what he's saying now is that the only interest the only recourse the chase has is to the trust is if we got a separate security interest ok a pledge you know or the mortgage that he was using is going to is what right do you have now against him  pledge is paid up and now what this there's been there's the fish and see where's that writ so to speak well in iran are we the fact that the pledges don't cover the full amount of the obligation but the pledge was for a finite number once it but there are still remaining obligation of seven hundred million dollars under the under the guarantee that the trust is a party to the fact that the that's the vehicle by which  the right to the deficiency is by virtue of what the same again of the fact that there is a there is a valid and binding contract how did you all blige mr winge it to pay that you have some certain yes paid yes now what what vehicle what instrument says and you're required to pay any deficiency we have a final judgment final not appealable judgment against the trust a judgment against a trust which is not limited in any way by right recourse in essence a simple perk for me just a simplified way of thinking about this is assume the trust has seven hundred million dollars you've got a judgment against it you don't want it to convey the money to ham to avoid you fulfilling the judge yes and the point about ownership here i think is a little bit of a strawman because what mr winter has done is he's divided the world into sort of two he says  either chase has a secured interest right through a pledge agreement or he has no claim whatsoever and the fact that the pledges don't cover the entire amount of the obligation does mean we don't claim it means we're under secured but then we are able to take all the remedies available to us is a judgment why wouldn't you want one panel to address this issue in the fraudulent conveyance i mean is i'm listening to this dialogue i find myself thinking you know kind of begs the question as to what you can do and it seems very puzzling to me in a kind of goes back to suggesting lack of finality i mean a very good reason for doing not doing things piecemeal this year you decide something just looking this way without appreciating what's behind you so your honor there cause there is a common legal issue that pervades the fraudulent conveyance ruling from the district court as well as this ruling i think that is why we both are in agreement that we'd like the court to get why why but i'm i'm actually thinking of something slightly different why isn't the in different indicative ruling request or rule fifty four of this issue and the fraudulent conveyance decision right if you're right i mean what should happen yeah i don't i can't disagree with that again if the primary objective i think everything should be finished and then we should figure it out but the legal just to be clear on what happened with the problem conveyance the fraudulent conveyance action was brought we got a judgment on the pleadings with respect to liability suggest that really as a separate action it was a separate action it was consolidated into the main action because the judge if you this district court viewed this lady as a little unfair to him if you assume it's not a fraudulent conveyance and then want you to the money was properly not in the trust i and you can then take it before that or is all well in your honor i think again they had an ability it's the same issue it's the question of who actually owns this trust now as we sit here today they've put all the money back into the trust and so we're pursuing our claim under our final not appealable judgment against the trust and so we're simply chasing the money you know we have this fraudulent conveyance issue frankly as a practical matter sort of we can collect against the trust we don't have to go back against it it's in it's much as money's back could you dismiss that could  use the fraudulent conveyance by night i don't this the sin yes taking it the the remedy returning it your honor i don't think so ok of the following reason it may be the case that we cannot fully satisfy the obligations through the return of the essentially deprived us of the ability to recover against this not am i right in private thinking about this practically that if you're right in the project conveyance what ends up happening is it doesn't get conveyed it stays in the trust and then they have authority if they want not to distribute if they don't have to distribute you part of your of the whole theory here is you can still go directly against the trust and we are going against the trust by virtue of the charging leads i guess is the way and so so it but i guess the charging means do you no good if they don't distribute as my points i'm trying to figure out the reason i thought it was a practical question is to explain to me if it's roger conveyance so it couldn't be transferred to the trust they say we're not distributing at all and then garnishments an abstract point who cares what happens next well what happens next is we seek to execute against the remaining assets in the trust which are the corporations we have the charging leans to the extent that there are distributions  no distributions i get your honor that's up to mr winship whether their distribution came with and that means your client can't get anything until he dies and then you have a new fight about that am i right that may be the case your honor and fortune that's the way in which we're that's the way in which the charging lean i mean that she has to work so funny to me i mean we've we've gotten the suggestion there won't be distributions so we're going to resolve all these issues to do nothing your honor i don't think you're doing well because before the following reason i think it is actually quite important for both sides to get a ruling on the legal question because if you resolve it in a particular way it will have implications for the other assets that are being held in the trust against which we're seeking to execute and will have you know practical implications for mr winters as well in terms of whether he can distribute them and whether he has to pay chase those why does it have that effect other assets in the truck trust in as much as it is limited to the charging orders that are that are in the trust as well and so does the charging order say you can access something other than distributions from the elysees right so why you telling us it's got broader because the legal question that's been presented here is who owns the property so the big the big answer would be who's who whose property is it is it him individually or the you w the answer for the presidential fact it will happen yes of course that's that's exactly right because the bar and the point were simply making is we have the remedy we have the rights of a judgment creditor the fact that you enter into a contract with authority there's never  claim here by the way that the trustee was acting i think judge comes right now so you've got what you need with him well he says perspective it's really the other side that has the jeopardy your honor we can we can proceed again there's no stay here so we can proceed where we're mean we're moving to proceed with respect to the other assets a player not distributing right now they're not stripping right now but that but there are corporations and we are proceeding with respect to the corporations but the issue it that's one more really silly question which i'm sure there's an easy answer to which is i'm just curious where you can get all this is judge starting points out but there can be no remedy at the end and but it's a pain and for him too earth much as we enjoy being in front of this panel we much prefer to get this issue resolved and have you chatted but we haven't actually said hey why don't we stop it it's expensive it's ridiculous yes you have and it's just no way jose used our call calico we have not used mr calico but we have we have actually used the services of a mediator we had a mediation with judge rhodes you know for former chief of the bankruptcy court and in detroit we had a number of sessions with mr we've tried your honor and look i don't rule out anything in this case and you know if we were able to you know come to a satisfactory accommodation we won't bother you anymore but unfortunately there are these overarching legal issues which i think just make it very difficult for them it is very much a binary issue and that in ten years it's an either or but you know what when you're in future settlement remember this wasn't a judgement like  thousand three hundred and three and it's now up to seven hundred and fifteen or so they have that feud settled you would have a lot of that three hundred million just tell your clients that that's a lot of that would have been yours and your honor and i say i look and there's been us that's when we pay taxes but in that kind of situation there's quarterly taxes so the distributions are four times a year to satisfy that one hundred million dollars plus obligation like you should settle to we've tried i want to make  that there is an end to never this can't go on forever because eventual of those taxes will have to be paid plus chase even now is trying to get the district court to compel the sale of corporate assets so if you're going to send a question back to the district court the way i would frame it is are the charging orders final and enforceable because if he says yes then you've got jurisdiction to decide the merits and if he says no then they can't enforce the charging orders i would go that route would we know how to do the rule for art thank you i just want to know what's your position on whether to bring up the vanes decision that is their separate claim it doesn't need to be part of this case and what explain to me why we wouldn't want to decide that at the same time i'm not following that because that issue was resolved if you rule on the issue in this case a fraudulent conveyance because those assets were subject to a judgment that chase could potentially get the litigation was ongoing the district court in its st ruling had held it was mr lynch it's proper you're not worried that you've looked at this and you're not worried that if we rule against you we could doing both together in other words we should do both together the problem let's get the fraudulent conveyance resolved the same time we get the guy order resolved their claim under the fraudulent conveyance and my friend on the other side started to explain this would be that even if putting everything back in the trust was the right thing to do that they could have been damaged by millions of dollars during the time when it was out of the trust of mr lynch it was taking distributions and you could have a multi year proceeding in a trial on that issue that nobody wants to go through if this court says the trust doesn't own the assets the settle or does when you've got a revocable trust the jeopardy rolls the other way the jeopardy does rule the other way and one other prejudiced point that i want to bring up about not resolving this issue now  never been resolved so the judge the par you started by saying mr lynch it owns the property that's that's correct but then you said it's in the trust has seven hundred and fifty million dollars but even if the trust had seven hundred and fifty million dollars sitting in it that's still a mystery when it's property so they don't get to collect on it and they knew that and that's why i don't ok so explain this to me you know i'm sorry that i don't understand it but yes if the trust has seven her fifty million yes and they die a judgment against the trust yes the member of the trust the owner of the trust can poll it out and their judgments illusory against the trust it without a personal pledge is not a looser because at the time that the trust signed the guarantee there was one hundred and fifty million dollars in collateral pledge so that it wasn't illusory they had collateral but that's gone now because the pledge has been satisfied if chase wanted what it's asking for now it would have gotten a pledge for an unlimited amount that when they asked winship for that the record is clear on this he said no and if the settler makes clear to chase you don't have access to the money in the trust above one hundred and fifty million dollars chased can't then come back to fifteen years after the fact and ask for seven  explain to me how it's clear that the bank gives you whatever let's just say one hundred dollars yes ok to make it easy bank gives you one hundred hours and says you pledge to pay fifty dollars and will secure the rest from the trust which has the is because no one thought that the guarantee was actually unlimited the whole purpose of the reformation trial and what the district court found was that everyone intended that that the pledge was only for fifty million dollars and this court on a an unlimited guarantee and mr winch it had a fifty million that guarantee but where the rubber meets the road you know this then you may chase form consistent with michigan law across the country which says if you want to be able to access everything that's in the trust you need the settlers permission to do it and they knew that that's why they got they got the pledge and got hit as i wouldn't have not useful the judgment that is already on the technicality does that obviate your argument here  the judgment is against the trust alone and it's the unlimited guarantee the question that we're asking you that chase is asking you to answer is what trusts or what assets does the trust own and the trust only owns