BAD DIVORCE PLANNING? FRAUDULENT CONVEYANCE ACTION BY HUSBAND AGAINST WIFE SURVIVES MOTION TO DISMISS
I recently came across an interesting decision in a case which highlights the problems and liabilities which arise from inept or ill-advised divorce planning by business owners and their families.
The case comes from the Nassau County Supreme Court and was reported in the New York Law Journal on January 8, 2008.
The parties were married in 1996. In 2001, the wife’s father sold her all of his stock in an automobile dealership he owned for $1.4 million. The wife made a down payment of $150,000.00, using funds provided to her by her husband, and executed promissory notes for the balance. The husband claimed he paid a total of $785,000.00 to the wife’s father on account of the notes, and that he and his wife agreed that the shares in the dealership and certain other assets would be jointly owned by them.
Six months before filing for divorce, the wife defaulted on the notes and then transferred the shares in the dealership to her father. In the divorce action, the wife claimed she had no interest in the dealership.
The husband brought multiple claims against the wife, her father, and various corporations owned by the father and the wife. The claim which survived the defendants’ motion to dismiss was for a fraudulent conveyance in violation of Debtor and Creditor Law 276-a transfer made with actual intent to defraud a creditor.
The Court found that the plaintiff’s claims regarding the wife’s intentional default on the notes six months before commencing a divorce action, the surrender of the shares to her father were sufficient to defeat a motion to dismiss the complaint.
I wonder what advice the wife received, if any, and from whom. It appears from the decision that the planning for the divorce was clumsy at best. This case is an excellent example of the need for sound and professional divorce planning by business owners and their families.
hello there i have a question & my question is..
i'am married for 7 years to a man and i'am a lesbian my husband does not know that i'am a lesbian, we have 6 yrs old twins and i want to file a divorce..does the custody of my children will be granted to me??