![]() ![]() ![]() Where a creditor has a claim against a debtor's assets, whether by judgment or otherwise, that debtor may not convey or otherwise dispose of such property in an effort, or to the effect, to deprive the creditor of her legitimate right to recover such assets as may satisfy the obligation due the creditor.Ī fraudulent conveyance is a transfer by a debtor of property to a third person undertaken with the intent to prevent a creditor from reaching that interest to satisfy its claim. This article shall outline the statutory scheme and give some practical advice to both judgment creditors and judgment debtors While the Act and the cases generally refer to “fraudulent transfers” in reality the relief provided is not that related to the typical Fraud action but is honed to the particular circumstances surrounding a debtor seeking to evade judgment. The courts have long recognized this tendency on the part of debtors and the legislature, as well, has passed various statutes giving judgment creditors the power to void the transfers under certain circumstances. Some judgment debtors, realizing that the writs of attachment are soon to be issued by the Court, decide to hide their assets, often transferring them to relatives or friends, sometimes to entities out of state or out of the Country, sometimes simply putting them under false names. See our article on Debt Collection-the Tools Available to Collect Judgments for a detailed analysis of the tools available. A judgment is only a piece of paper obtained at the end of litigation until it is used to seize a debtor’s assets or to force a debtor to pay the debt.
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