Fraudulent Divorce: Can A Property Settlement Agreement Be Reversed As Creditor Fraud?
Generally, if a husband transfers non-exempt property to his wife in the face of a creditor's claim or lawsuit, the transfer will be reversed a a fraudulent conveyance. From time to time people who anticipate a legal problem tell me that in the event they lose a lawsuit they will divorce their wives and give their property to their wife as part of the divorce. The legal issue is whether there can be a fraudulent divorce to avoid or delay creditors. Does the fact that the divorce settlement is approved by a court protect property transfers made pursuant to the settlement agreement?
I think most courts would find that there can be a fraudulent divorce and that transfers made as part of a divorce settlement can be set aside. The answer depends on the facts of each case. The court would have to decide if the divorce is an arms-length divorce or part of a marital conspiracy to protect family assets. Certainly, if the spouses continue to live together and or not maintain separate lives there is less chance of the property transfers surviving challenge. Transfers in exchange for release of marital rights such alimony are on firmer ground.
This question involves competing public interests. Courts protect dependent spouses. Property transfers to provide the dependent spouse sufficient assets to maintain their lifestyle serves that public purpose. Courts also tend to enforce their own judgments and grant creditors equitable remedies to collect their judgments.
I have not seen any Florida cases setting aside a divorce as a creditor fraud.
posted by Jonathan Alper, asset protection and bankruptcy attorney, Orlando, Florida
COULD ANYONE TELL ME HAVE ONE PROVES MARITAL FRAUD AND MISREPRESENTATION IN THE STATE OF FLORIDA...WHAT STATUTES COVER THAT? MY HUSBAND DID NOT TELL ME ABOUT HIS PRIOR HISTORY OF DOMESTIC VIOLENCE, MENTAl HEALTH ISSUES, MALINGEERING...ETC. IN FACT HE STATES IN A LETTER OF AMENDS HE DELIBERATLEY DID NOT TELL ME HE WAS AN ALCHOLIC...SO I WOULD MARRY HIM..SO, MY QUESTION IS..WHAT DO YOU HAVE TO DO TO PROVE FRAUD AND WHAT STATUTES ARE INVOLVED? I WOULD APPRECIATE ANY HELP ANYONE COULD GIVE ME AS MY ATTORNEY JUST DIED...THANK YOU IN ADVANCE FOR ANY HELP YOU CAN GIVE ME. LEE
I HAVE REPEATEDLY ASKED OUR STATE ATTORNEY FOR HELP AND I HOPE I WILL HEAR FROM HIM VERY SHORTLY..HOWEVER..DOES ANYONE KNOW..IF I DO NOT HEAR FROM HEAR..WHAT I COULD POSSIBLE DO? I AM A VICTIM OF A VIOLENT CRIME AND A VICTIM OF MARITAL FRAUD, MISREPRESENTATION AND THEFT. I HAVE REPEATEDLY ASKED FOR HELP. OVER AND OVER AGAIN. LAST WEEK I WROTE OUR STATE ATTORNEY ONE LAST LETTER AND TRULY HOPE ... IT WILL INSPIRE HIM TO ANSWER...HOWEVER...WOULD ANYONE OUT THERE KNOW WHAT TO DO IF I SHOULDN'T HEAR FROM HIM...I KNOW I CAN FILE A COMPLAINT WITH THE BAR ASSOCIATION...IS THERE ANYPLACE ELSE? I WOULD BE WILLING TO LISTEN TO ALL SUGGESTIONS BUT I COME FROM BOSTON WHERE ONE RETURNS PHONE CALLS AND LETTERS...UNFORTUNATLEY...IT IS A COMMON PRACTICE FOR ASSISTANT STATE ATTORNEYS IN FLORIDA NOT TO DO THIS...IT IS TIME TO START A NEW POLICY...CIVILITY...GRACIOUSNESS...GOOD MANNERS...AND EQUAL RIGHTS FOR CRIME VICTIMS ..... PARTICULARLY WOMEN CRIME VICTIMS...THAT WOULD BE NICE...LOOKING FORWARD TO HEARING FROM YOU ALL.
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