Default in Argentina, Repercussions in New York: Self-Settled Trusts and Choice of Law

Abstract

A choice of law provision in a trust agreement, as is the case with any contract, may not be enforceable against persons who are not parties to the agreement. This point was recently reinforced by the U.S. Court of Appeals for the Second Circuit in EM Ltd., et.al. v. The Republic of Argentina (“EM, Ltd.”). The case involves the validity of a self-settled trust created outside of the U.S. by parties who have basically no connection to the U.S. in terms of domicile or residence. It is noteworthy that EM, Ltd. did not arise in the context of estate or asset protection planning. This brief article concerns that case.