Fraudulent Transfers: Void and Voidable

Authors

David G. Carlson, Benjamin N. Cardozo School of LawFollow

Publication Date

Winter 2021

Journal

American Bankruptcy Institute Law Review

Abstract

This Article explores the civil procedure attendant to private fraudulent transfer litigation (primarily outside the context of bankruptcy). In such litigation, courts ponder whether fraudulent transfers are void or voidable. In fact, they are both simultaneously! According to the theory "at law," a fraudulent transfer is "void." That is, a creditor with a judgment could simply levy the property from a fraudulent grantee as if the grantee had no property rights. This Article questions the constitutional viability of this ancient attitude. Meanwhile, "equity" viewed the transfer as voidable. The grantee gets title, but the title might be set aside. The Article explores the ancient law-equity contradiction in the context in which the enforcing creditor already has a money judgment against the transferor and wishes to reach the property of the transferee. It also explores fraudulent transfer avoidance as a pre-judgment remedy and finds that the law-equity contradiction is equally alive in this context.

Volume

29

Issue

1

First Page

1

Last Page

82

Publisher

St. John's University School of Law, West

Disciplines

Banking and Finance Law | Bankruptcy Law | Commercial Law | Estates and Trusts | Law | Legal Remedies | Property Law and Real Estate

Recommended Citation

David G. Carlson, Fraudulent Transfers: Void and Voidable, 29 Am. Bankr. Inst. L. Rev. 1 (2021).
https://larc.cardozo.yu.edu/faculty-articles/792