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What is the statue of limitation for fraudulent transfer in california after discovery by creditor?

Encino, CA |

there was a transfer of real property 15 months ago that creditor claimed it to be fraudulent. creditor was aware of this transfer at that time, Can the creditor setaside the transfer or there is a one year statute of limitation against the creditor to dispute it?

Attorney Answers 2


It is a 4 year statute under Civil Code 3439.09, or one year after discovery, whichever is later. In other words, transfer 15 months ago is not barred by statute even if creditor was aware of transfer.

The response given is not intended to create, nor does it create an ongoing duty to respond to questions. The response does not form an attorney-client relationship, nor is it intended to be anything other than the educated opinion of the author. It should not be relied upon as legal advice. The response given is based upon the limited facts provided by the person asking the question. To the extent additional or different facts exist, the response might possibly change. Attorney is licensed to practice law only in the State of California. Responses are based solely on California law unless stated otherwise.

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In bankruptcy, pursuant to 11 U.S.C. �548 (section 548 of the Bankruptcy Code), a fraudulent transfer is any transfer of any asset--or any interest in any asset (such as part ownership in a home)-- made within two (2) years prior to filing the bankruptcy case and in which either of the following are true: A. The transfer was made with actual intent to hinder, delay, or defraud any entity to which the debtor was or later became indebted to; OR B. the debtor received less than reasonably equivalent value for the exchange AND was insolvent on the date the transfer was made (or became insolvent as a result of the transfer).

An important thing to know about the above, is that the transfer discussed above can be either voluntary or involuntary.

In California, the fraudulent transfer law is very similar and is set forth in Civil Code section 3439.04. The statute of limitations is set forth under Civil Code section 3439.09. It is almost identical to the bankruptcy statute except that the lookback period is up to 7 years from the date of the transfer. Thus, if you file bankruptcy in California, the Trustee can sue the transferee for any transfer that took place within 7 years prior to the filing of the bankruptcy case. And, under California's general fraud statute (CCP 338) the lookback period is 3 years from the date the affected party discovers facts constituting the fraud.

If you'd like to speak with an attorney, feel free to contact my office.

Good luck!

Disclaimer: Attorney's response does not create an attorney-client relationship. Attorney's response is not intended as legal advice and is intended for informational purposes only. Inquirer should seek the advice of a duly licensed attorney within that jurisdiction.

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