A conveyance of an asset to someone else, without consideration, is a fraud on a creditor, if the result is that the creditor cannot collect the full amount of the debt.
Fraudulent Conveyance Claims: Bring Suit or Defend
Allegations of fraudulent conveyances arise in a variety of circumstances such as the following:
- A debtor transfers title to someone in the family to protect the asset from the reach of his creditors — presumably with an unspoken agreement that the property will later be returned, once the threat of loss to a creditor has passed.
- The debtor makes the transfer of assets to a family member with no consideration (payment) received from the family member.
- A friend “buys” an asset at a bargain-basement price with the understanding that the asset will be sold back, after the heat of collection has passed.
In plain English, fraudulent conveyances are “shady deals.” I have seen them occur after a judgment has been rendered and collection of the judgment commenced. I have seen them occur during a lawsuit, when a party contemplates losing the suit. And, in some cases, I have seen them employed to avoid collection efforts by the IRS, both before and after tax litigation has occurred.
To cancel a fraudulent conveyance and get the property back in the hands of the original owner of the asset so that you can collect by seizing it, one must file a suit under the Uniform Fraudulent Conveyance Act. You may have an opportunity to collect directly through a settlement, but it all needs to start with the filing of suit.
Contact John McDuff
If you are looking to discuss the need to collect an asset that has been put out of your reach, or discuss the need to defend a suit that has been wrongfully filed, contact my law firm at 512.457.1177. I am John McDuff, attorney at law, and I am well qualified and prepared to evaluate a case, make recommendations, and prepare to bring suit or defend someone wrongfully accused of making a fraudulent conveyance. The quality of my work as a lawyer is well recognized by my clients & I have received the AV rating* under Martindale-Hubbell’s peer review rating system. My clients are predominantly from Austin and Central Texas, and occasionally from other states.
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