Appellate Opinion on Fraudulent Conveyances

by | Apr 9, 2013 | Firm News | 0 comments

In March 2013, the Maryland Court of Special Appeals issued an unreported decision which affirmed the Montgomery County Circuit Court’s ruling that vacated a spouse’s conveyance of the family home to a Trust for zero consideration as a fraudulent conveyance.   Stewart A. Sutton represented the husband who sought to vacate his ex-wife’s frauduent conveyance of the family home so that his monetary award would attach as a judgment lien to this real property.  The Appellate court concluded: “As there was no genuine dispute of fact concerning [wife’s] insolvency at the time of the transfer, the lack of consideration for the transfer, or that the Trust did not purchase the real property in good faith, without notice, and for value, the circuit court did not err in determinining, as a matter of law, that [wife’s] conveyance of the property to the Trust was a fraudulent conveyance under the Maryland Uniform Fraudulent Conveyance Act”.   Practice pointer: There are two ways to establish a conveyance is fraudulent under the MUFCA.  First, the conveyance was made with the actual intent to defraud potential or actual creditors.  Secondly, the property was conveyed by the debtor for less than fair market value at a time when the debtor was insolvent.


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