Atlanta Fraudulent and Voidable Conveyance Litigators

People or businesses often transfer assets; it’s common and rarely are there complications. But what if someone is trying to collect a debt or if there is money owed to someone else? Often, debtors run into financial problems and are unable to meet their financial obligations; however, whether it is acceptable – or legal – to transfer cash or assets is a significant question, especially when it may impact someone else. If the transfer is made to avoid repaying a debt by moving funds or transferring property, this may be considered fraudulent or improper, and a civil cause of action may be appropriate. Our Atlanta fradulent and voidable conveyance litigators will help you with your debt collection efforts.

As part of a firm’s debtor and creditor practice, the attorneys at Hecht Walker, P.C. represent clients’ rights, whether they are the creditor or debtor. Not every questionable transfer is found to be illegal nor is every transaction improper. But it’s important to investigate the matter with the help of an experienced attorney. He or she can evaluate the evidence, gather relevant information and initiate proceedings to address the matter in court. Ultimately, the courts may rule on the matter. In some cases, allegations of fraud could be pursued against a defendant.

What are fraudulent conveyance or voidable transaction claims?

“Fraudulent” or “Voidable” conveyances are terms used to describe improper transfers of cash or other assets that are done in a way that limits another’s ability to collect on its claims. A party who is owed something is known as a creditor. Creditors can use fraudulent or voidable transfer claims in an attempt to recover a debt owed by a debtor when that debtor has improperly transferred its assets, whether those assets are cash or property. An improper fraudulent or voidable conveyance presents a number of problems because they can hinder or delay a creditor’s efforts to collect on a legitimate debt. It might include property transfers during a divorce (personal or business), the winding down of a failed business venture or any number of other scenarios. If the debtor becomes insolvent as a result of the transfers, the transfer may be fraudulent or voidable, and there may be steps that the creditor can take to recover the transferred asset.

Within the state of Georgia, there exists both the Uniform Fraudulent Conveyances Act and the Uniform Voidable Transactions Act. Creditors will often seek to bring such claims against insiders for the conveyance of assets outside of the debtor’s control or possession to avoid the creditor’s primary claim. Remember: not every transfer by a debtor is improper; sometimes debtors and others are sued without a legal basis.

The Hecht Walker, P.C. team has successfully handled these types of litigation cases over the past two decades.

Atlanta Fraudulent Conveyances Attorney

Will I collect if I win a judgment?

Winning a judgment does not always immediately equate to collecting on a judgment. When it’s not possible to collect from the debtor, there may be potential claims that can increase the collection rate.

When the amount of the judgment is substantial, and the debtor clearly has no way of paying the debt, things to keep in mind for the future might include a shift in the debtor’s real estate holdings, changes in its lifestyle, or other business relationships. These are all questions with answers that can provide some insight into other potential claims. If it appears assets have been transferred, that may open a new avenue that’s worth pursuing. A debtor may suddenly gift assets, such as luxury items, to a family member after the judgment has been recorded; or the debtor may transfer all of its inventory or equipment to another business. If nothing is given in return, you can potentially institute a claim under Georgia’s Uniform Fraudulent Transfers Act. You can also potentially institute a claim under the Uniform Voidable Conveyances Act.

What are the Georgia Uniform Fraudulent Transfer or Uniform Voidable Conveyances Acts?

Although these are two different Acts, they address similar concerns. Those differences are significant; however, knowledgeable legal counsel, such as the attorneys of Hecht Walker, P.C., can be very helpful in navigating them. These Acts generally allow for Courts to consider various factors to determine if an asset transfer was fraudulent or voidable. The courts can then make the determination whether the assets were transferred to avoid paying the outstanding debt. If so, the courts can hold the recipients of the transferred assets (the transferees) liable for the underlying debt in accordance with the Acts.

There are a variety of considerations when bringing a claim against a fraudulent transfer or voidable transaction. Actual fraud is when the creditor can prove the debtor acted with an actual intent to hinder or delay the creditor from collecting the asset. Like any other claim dealing with intent, there are challenges in trying to prove it. Constructive fraud can occur during an asset transfer if the creditor can show at the time of the transfer that a claim against that debtor existed and that the debtor never received fair value for the transferred asset. Under either Act, whether the debtor actually intended to defraud the creditor may not matter if there are other objective criteria are satisfied; in such cases, the law presumes that the transfer was fraudulent or voidable.

The Uniform Fraudulent Transfers or Uniform Voidable Conveyance Acts provides guidance for businesses and other entities within the state of Georgia. When debtors convey assets outside of their control or custody, they risk the potential of having the transfers set aside. It’s important to note that these cases are not limited to debtors; they also apply to asset transfers for avoiding liability even before a judgment is entered.

Clearly, these are complicated cases and require a unique insight into litigation and corporate and business law. It can often require additional litigation. The attorneys at Hecht Walker, P.C. have years of familiarity with Georgia’s corporate and business laws. While most clients prefer a settlement, we stand ready to litigate or defend your case in a Georgia courtroom.


This information was posted on 08-23-2016 and does not constitute legal advice nor does it create an attorney-client relationship. The law changes on a daily basis. The reader should engage an attorney through a written agreement before taking action in this area of the law.