Offshore but Not Untouchable: Lessons from the Rensin Trust Case

Will an offshore self-settled asset protection trust—moved from the Cook Islands to Belize—protect its assets from a U.S. bankruptcy trustee’s reach, or can the court “look through” to the settlor’s beneficial interests and recover value for creditors?

Joseph K. Rensin, a Florida resident and businessman, had established the Joren Trust, originally under Cook Islands law and later migrated to Belize. He was the settlor and a discretionary beneficiary. Over time, the trust made multiple distributions to or for his benefit totaling roughly $8.6 million, including payments for legal fees and business ventures.

The Joren Trust later purchased two annuities with trust funds:

• A fixed annuity that paid regular income to Rensin; and
• A variable annuity not yet annuitized, owned by the trust’s Belize trustee.

In 2017, Rensin filed Chapter 7 bankruptcy in Florida. The Chapter 7 trustee (Nicole Mehdipour) brought an adversary proceeding seeking:

1. A declaration that Rensin’s interests in the trust and annuities were property of the bankruptcy estate;
2. Turnover of those assets under 11 U.S.C. § 542; and
3. Disallowance of claimed exemptions.

Both parties moved for summary judgment on stipulated facts.

Judge Erik P. Kimball issued a detailed opinion partially in favor of the bankruptcy trustee:

1. Choice-of-Law and Public Policy
   • Although the trust instrument invoked Belize law, the court held that Florida law governs the reachability of trust interests for Florida creditors.
   • Florida public policy (Fla. Stat. § 736.0505) allows creditors to reach the maximum amount that may be distributed to or for the settlor’s benefit, regardless of foreign spendthrift protections.
   • Accordingly, Florida’s anti-self-settled-trust rule overrode the foreign choice-of-law clause.
2. Fixed Annuity (Active Payouts)
   • Because Rensin was already receiving payments, those payments and his right to continued receipts were property of the estate.
   • The trust’s remainder interest stayed with the Belize trustee, but the estate could claim all distributions payable to Rensin.
3. Variable Annuity (Not Yet Annuitized)
   • The court declined to compel turnover since the Belize trustee—who held legal title—was not before the court and beyond its personal jurisdiction.
4. Exemptions and Conversion Statutes
   • Rensin argued the annuity payments were exempt under Fla. Stat. § 222.14; the court agreed only partially.
   • The trustee’s attempt to invoke Fla. Stat. § 222.30 (fraudulent conversion to exempt assets) failed because Rensin himself had not directly purchased the annuities—the foreign trustee had.
5. Turnover and Joinder
   • The court refused to order turnover of trust corpus absent joinder of the Belize trustee but invited the bankruptcy trustee to seek that joinder if feasible.

From an asset-protection perspective, Rensin is a landmark case showing both the strengths and limits of offshore protection.

• The foreign trustee and situs effectively prevented the U.S. court from ordering direct turnover of the trust corpus—jurisdiction stopped at the water’s edge.
• However, because Rensin retained beneficial rights and the trust was self-settled, the court applied Florida law to disregard foreign spendthrift protections for any portion distributable to him.
• In short, the trust’s offshore location worked only to the extent of practical enforcement, not as an absolute legal barrier.

The decision underscores that domestic public policy will override foreign trust law whenever a U.S. court has personal jurisdiction over the debtor.

In re Rensin teaches two crucial lessons:

• Courts apply local law to local debtors. A choice-of-law clause naming Belize or the Cook Islands won’t prevent a Florida court from applying its own anti-self-settled-trust rules.
• Jurisdictional reach is the last line of defense. Offshore trustees and assets beyond U.S. borders may resist enforcement in practice, but any beneficial rights, annuity income, or U.S.-situs assets are fair game for creditors and bankruptcy trustees.

Result: The court partially pierced the offshore trust—capturing all payments and benefits due to the debtor—but stopped short of seizing the foreign corpus it lacked jurisdiction to compel. The case validates the Bridge Trust® concept: keep the trust domestic under normal conditions but capable of transitioning offshore before litigation, preserving foreign protection before U.S. courts assert control.