Chapter 7 trustee brought claims against debtor’s non-filing wife and a limited liability company determined to be debtor’s alter ego, seeking to recover fraudulent transfers of money and to impose implied trusts on assets purchased with Debtor’s funds but titled in his wife’s name. The Court held that, under 11 U.S.C § 544(b), the trustee could “stand in the shoes” of the IRS (another creditor in the case) and invoke the Internal Revenue Code’s longer 10-year statute of limitations to recover fraudulent money transfers debtor made to his wife over seven years prepetition. Trustee could not recover, however, amounts for which the debtor received reasonably equivalent value in the form of payment of living expenses for himself and his family. In addition, the Court found that the trustee was entitled to impose resulting and constructive trusts on two homes and three vehicles that the Debtor had purchased with his funds, but titled in her name in an effort to shield those assets from creditors. The debtor’s wife was entitled to retain a one-half interest in one of the homes based on evidence that she had contributed her own funds to make some mortgage payments on the home.
Official websites use .gov
A
.gov website belongs to an official government
organization in the United States.
Secure .gov websites use HTTPS
A
lock
(
) or https:// means you’ve safely connected to
the .gov website. Share sensitive information only on official, secure websites.