Fraudulent Transfers

Is Debtor’s Separate Money In To An Entireties Bank A Fraudulent Transfer?

A debtor’s transfer of non-exempt cash to avoid collection of a judgment can be reversed as a fraudulent transfer. The fraudulent transfer issue often arises when a debtor deposits money in to a bank account owned tenants by entireties. In many cases, a married debtor maintains all his financial accounts…

Can Creditor Challenge Disclaimer of Inheritance As A Fraudulent Transfer?

A debtor expects to inherit a significant amount of assets from a parent while he is already subject to a civil judgment. The debtor is concerned that the inherited assets will be exposed to his judgment creditor. The debtor is considering executing a formal “disclaimer” of the inheritance so the…

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Are Fraudulent Transfer Debts Dischargeable In Bankruptcy?

A bankruptcy debtor cannot discharge debts incurred by false representation or actual fraud. Appellate court decisions split as to whether a debt incurred as part of a fraudulent transfer of assets is included in the category of “actual fraud” that may not be discharged in bankruptcy. Some courts have held…

Statute of Limitations After Discovery of A Fraudulent Transfer

Creditor actions for fraudulent transfers must be brought within four years of the transfer pursuant to Florida Statute 726.110. There is a “savings clause” that gives creditors no less than one year to file an action after they discover the transfer regardless of whether the transfer occurred more than four…

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Converting Florida Homestead To Income Producing Rental Property

One of my clients owned a Florida homestead which he wants to convert to a rental property. He plans to himself rent a smaller home and live on net rental income from the former homestead. He suggested to me transferring the homestead to an LLC that he would own with…

Proceedings Supplementary Extend Statute of Limitations For Fraudulent Transfers

The statute of limitations for creditors’ fraudulent transfer actions is four years. However, a recent Florida case holds that the four year limit does not apply to fraudulent transfer claims brought in the context of Proceedings Supplementary. Creditors can challenge transfers at any time during the 20 year life of…

Which State Has Jurisdiction Over Fraudulent Transfer Action?

A creditor considering a fraudulent transfer action against a debtor’s transfer of real estate has to consider where to file the lawsuit. The issue becomes interesting when the debtor, the debtor’s property, and the recipient (transferee) of the property are each located in a different state, or if all in…

Does Asset Appreciation After A Fraudulent Transfer Affect Transferee?

The fraudulent transfer statutes give the creditor the right to sue the transferee for the value of the asset transferred. A creditor may get a judgment against the initial transferee who receives the asset. One of my clients asked me whether an increase in value of the asset after the…

Court Says Company Issuance of New Stock To Dilute Debtor’s Shares is Fraudulent Transfer

A creditor may have the Sheriff levy upon stock in a corporation held in the debtor’s name. One debtor thought he could effectively protect his stock by causing the corporation to issues substantial amounts of new stock to his wife for a nominal amount of money thereby diluting and devaluing…