Creditor Remedies for Fraudulent Transfers in Florida

Florida’s fraudulent transfer statute gives creditors five categories of relief: avoidance, attachment, injunction, receivership, and (for judgment creditors) direct levy on the transferred asset. Section 726.108 lists these remedies, and a catch-all provision authorizes courts to fashion additional equitable relief as circumstances require.

A creditor can pursue these remedies through a standalone Chapter 726 lawsuit or through proceedings supplementary under § 56.29. The two paths differ in scope, available relief, and possibly in how long the creditor has to act. The choice between them, or the decision to pursue both at once, shapes the entire enforcement strategy.

What Does Avoidance of the Transfer Mean?

Avoidance under § 726.108(1)(a) is the primary remedy. A court voids or reverses the fraudulent transfer, returning the asset to the debtor’s estate where it becomes subject to ordinary collection.

Avoidance is proportional. A creditor owed $200,000 cannot void a $500,000 transfer in full. The court will unwind only enough of the transfer to satisfy the outstanding claim. If the transferred asset is indivisible, such as a piece of real property, the court may order a sale and distribute proceeds up to the creditor’s claim amount.

A creditor does not need a judgment before seeking avoidance. Even a creditor whose claim is unliquidated or contingent can bring a Chapter 726 action, though the court may require a judgment before allowing execution.

Attachment and Provisional Remedies

Section 726.108(1)(b) authorizes attachment or other provisional remedies against the transferred asset or other property of the transferee. Attachment allows a creditor to seize or freeze the transferee’s property before a final judgment on the fraudulent transfer claim.

A creditor seeking attachment must show a substantial likelihood of success, a risk that the asset will be dissipated before trial, and the inadequacy of other remedies. Courts weigh the strength of the fraudulent transfer evidence, including badges of fraud such as insider transfers, retained control, and concealment.

Attachment is most valuable when the transferee may sell or further transfer the asset before the fraudulent transfer case concludes. A court order freezing the asset prevents the transferee from defeating the creditor’s remedy through a second transfer to yet another party.

Injunctive Relief Against Further Transfers

Section 726.108(1)(c)(1) permits a court to enjoin further disposition of the transferred asset by the debtor, the transferee, or both. An injunction prevents the parties from selling, encumbering, or otherwise disposing of the property while the fraudulent transfer action is pending.

The injunction can reach beyond the specific asset that was transferred. The statute authorizes relief against “other property” of the debtor or transferee. A court may restrain a debtor from making additional transfers of any non-exempt property if the evidence suggests an ongoing pattern of asset concealment.

Injunctions are available to both pre-judgment and post-judgment creditors. For pre-judgment creditors, an injunction holds property in place while the underlying claim is litigated. For post-judgment creditors, it prevents further dissipation while the avoidance action proceeds.

When Courts Appoint a Receiver

Section 726.108(1)(c)(2) authorizes appointing a receiver to take charge of the transferred asset or other property of the transferee. A receiver is a neutral third party appointed by the court to manage, preserve, and account for the property until the fraudulent transfer dispute is resolved.

Receivership is an extraordinary remedy that courts reserve for situations where less restrictive measures will not work. Courts appoint receivers when the debtor or transferee has a demonstrated pattern of dissipating assets, when the transferred property requires active management, or when the parties cannot be trusted to protect the asset pending resolution.

Receiver compensation is a practical concern that both sides weigh carefully. Receivers are paid from the assets under their control. When the transferred property is a business or partnership interest, receiver fees can consume a meaningful share of the value being fought over. That cost creates settlement pressure on the debtor and a potential downside for the creditor if the receivership outlasts the value of the asset.

Levy of Execution on the Transferred Asset

Section 726.108(2) provides a remedy exclusively for judgment creditors. If a creditor already holds a judgment on the underlying claim, the court may authorize direct levy on the transferred asset or its proceeds. The sheriff physically seizes the property or garnishes funds for sale to satisfy the judgment.

Pre-judgment creditors cannot levy. They must rely on provisional remedies (attachment, injunction, or receivership) to hold property in place while the case proceeds.

Lis Pendens on Transferred Real Property

When the transferred asset is real property, the creditor may record a lis pendens upon filing the avoidance action. A fraudulent transfer claim seeking to void a real property transfer affects title and therefore qualifies as a claim supporting a lis pendens. Recording a lis pendens clouds title and impedes any further sale or refinancing while the avoidance action is pending.

A lis pendens does not require court approval to file. The creditor need only assert a claim affecting title. The practical effect is immediate: title companies will not insure a transfer while a lis pendens is recorded, which effectively freezes the property without the cost and delay of a motion for injunctive relief.

How Broad Is the Catch-All Provision?

Section 726.108(1)(c)(3) authorizes “any other relief the circumstances may require.” Florida courts have debated the scope of this catch-all language for two decades, and the Eleventh Circuit’s 2023 decision in SE Property Holdings v. Welch narrowed it.

The Florida Supreme Court first addressed the catch-all in Freeman v. First Union National Bank, 865 So. 2d 1272 (Fla. 2004). The court held that the catch-all was meant to facilitate other remedies already in the statute, not to create new causes of action. The Eleventh Circuit extended that reasoning in SE Property Holdings to hold that the catch-all does not permit a money judgment against a transferor, punitive damages, or attorney’s fees.

The practical consequence: the catch-all does not give creditors a second judgment against the debtor for committing a fraudulent transfer. It gives courts flexibility in fashioning the equitable remedies the statute already provides (avoidance, attachment, injunction, receivership), not the authority to award damages beyond those remedies.

Money Judgments Against Transferees

Section 726.109(2) authorizes a creditor to recover a money judgment against the first transferee or any subsequent transferee who did not take in good faith and for value. The judgment is for the lesser of the value of the asset transferred or the amount necessary to satisfy the creditor’s claim.

The value of the asset is measured at the time of transfer, subject to equitable adjustment. If the transferee improved the property after receiving it, the court adjusts the judgment to exclude the value of improvements. A good-faith transferee who gave reasonably equivalent value is protected from a money judgment entirely.

This remedy fills a practical need. If the transferee has already spent the cash, sold the property, or dissipated the asset, avoidance cannot return what no longer exists. A money judgment against the transferee for the value received allows the creditor to collect even when the specific asset is gone.

Subsequent transferees face liability unless they qualify for the good-faith-for-value defense. A person who acquires property from the initial transferee without knowledge of the fraudulent transfer and for fair value is protected. A person who receives the property as a gift or who knows the original transfer was fraudulent is exposed to a judgment for the value received.

Proceedings Supplementary vs. a Standalone Chapter 726 Action

Creditors have two procedural paths for pursuing fraudulent transfer remedies, and the choice between them affects how much relief is available and how long the creditor has to act.

A standalone Chapter 726 action is a separate lawsuit with a four-year statute of limitations from the date of transfer. It provides the full range of statutory remedies: avoidance, attachment, injunction, receivership, levy, and money judgments against transferees.

Proceedings supplementary under § 56.29 let a judgment creditor challenge transfers within the existing case, avoiding the cost and delay of a separate lawsuit. The creditor files a motion and supplemental complaint in the court that entered the original judgment. The same judge who knows the case handles the fraudulent transfer claim.

The remedies in proceedings supplementary are narrower. Courts have held that § 56.29 does not independently support a money judgment against a transferee who no longer holds the property. The creditor must identify specific personal property still in the transferee’s hands. That limitation does not apply in a standalone Chapter 726 action, where § 726.109(2) expressly authorizes money judgments regardless of whether the transferee still holds the asset.

The most contested question is whether Chapter 726’s four-year limitations period applies to fraudulent transfer claims brought through proceedings supplementary. The Fourth District Court of Appeal held in McGregor v. Fowler White Burnett (2021) that it does. The Third District held in Rosenberg v. U.S. Bank (2023) that it does not, reasoning that proceedings supplementary can be initiated for the life of the judgment, potentially twenty years.

The Eleventh Circuit certified this question and several related issues to the Florida Supreme Court in Saadi v. Maroun (2025). The court’s answer will reshape how creditors pursue fraudulent transfers in Florida and determine how long personal property transfers to insiders remain vulnerable to challenge.

Limits on Creditor Remedies

Fraudulent transfer remedies are equitable, not punitive. A creditor’s recovery cannot exceed the amount of the underlying claim. A successful avoidance action does not increase the debtor’s liability; it restores the creditor’s ability to collect on the existing judgment.

The good-faith transferee defense under § 726.109(1) limits recovery from third parties who acted without knowledge of the fraud and gave reasonably equivalent value. Even a transferee who cannot fully invoke this defense retains a lien on the transferred property to the extent of the value actually given to the debtor.

Florida law does not allow creditors to sue professionals who assisted with the transfer but did not receive or hold the property. The Florida Supreme Court held in Freeman v. First Union National Bank (2004) that the fraudulent transfer statute does not create a cause of action for aiding or abetting a fraudulent transfer against nontransferees. Attorneys, accountants, and financial advisors who advised the debtor but did not take possession of the transferred asset are not liable under Chapter 726.