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By Randy Hughes, Mr. Land Trust

Supreme Court Justice Antonin Scalia said, “…there are too many lawyers in the United States…” He went on to say, “I do not mean to criticize lawyers, just the need for so many lawyers. Lawyers do not dig ditches or build buildings. When a society requires such a large number of its best minds to conduct the unproductive enterprise of the law, something is wrong with the legal system.”

Something is definitely wrong with our legal system and everyone in America knows it. What does this have to do with real estate and using Land Trusts to hold title to investment real estate… a lot. I think that lawyers serve a valuable service to our society. In fact, I use a lawyer in every one of my real estate transactions (to protect my interest with an insured closing). But, Justice Scalia has a point.

Some say that there are more lawyers in law school right now than current practicing attorneys. And that the United States has 95% of the lawyers in the world! The Illinois Bar Journal says that over the next ten years the USA will graduate 60% more lawyers than there will be legal jobs available to them.  How are all these multitude of lawyers going to make a living?

I predict that lawyers are going to find new and creative ways of suing people like us (real estate investors). After all, real estate investors hold title to hard assets. Lawyers want to know that they can collect after winning a lawsuit against someone. Therefore, real estate investors that hold title to their investments in their own name are easy prey for the contingency fee lawyer.

Legal theory has progressed exponentially in the last few years. Who would ever think that a business owner would be sued because a burglar sustained injury while breaking into the owner’s business? Or that a manufacturer would be sued because he failed to warn a consumer not to drink battery acid? Or that a real estate owner would be responsible for dog bite on his property (the dog was not the property owner’s or his tenant’s dog and the person bit was not the property owner’s tenant).

With the legal system reeling out of control it would behoove you to find a way to avoid being a target. The best way to avoid lawsuits is to have no assets (or at least appear to have no assets). Keep a low profile and don’t own ANYTHING in your own personal name (especially not real estate)!

Lawyers did not get through law school by being stupid. Any good lawyer (when deciding whether to take on a new case) will investigate the assets of the proposed defendant. A smart lawyer will only take on cases that he/she feels confident that he/she can win AND COLLECT ON! Therefore, one of the first steps a lawyer takes prior to filing a lawsuit is to check the public records to see if the potential defendant has any “hard assets” (i.e. real estate).

So, your first line of defense is privacy of ownership. And, if you are a smart real estate investor, the least expensive form of privacy is the use of a Trust to hold title to your investments. Please learn all you can about Land Trusts and how to use them. You will be glad you did!


Randy Hughes, Mr. Land Trust

If you want to learn more about the wonderful world of trusts, please go to: www.landtrustsmadesimple.com for more information. Or, if you would like to attend one of my FREE Land Trust Webinars, go to: www.landtrustwebinar.com/411 Also, feel free to call me with any questions. I actually answer my phone! 1-866-696-7347