![]() ![]() ![]() If the two year limitation period applied, then subject to a discoverability analysis, the action might be barred. The action was commenced three years and nine months after the transfer. Further, the defendant had several debts at the time of the transfer, which was completed for nominal consideration, despite the fact that the home was worth over 2 million dollars. In the case at hand, the defendant’s creditors were not alerted to the transfer of property at the time it occurred. The Incondo decision ultimately held that they had made the transfer with fraudulent intent and it was therefore voidable subject to the limitations period defence. The property was of significant value, but the consideration for the transfer was nominal.The transfer was made in the face of threatened legal proceedings.Although the conveyance was registered with the Land Registry Office, none of the defendant’s creditors were alerted to it.In this case there were several, including: Was the transfer made with the intention to avoid outstanding debt? Incondo set out the badges of fraud that help answer the key question of the intent at the time of the transfer. The test for determining intent in such cases was established in the 2014 ONSC decision of Incondo Building Corporation v. Is the action barred by the two-year limitation period found in the Limitations Act?Įvery conveyance of real property or personal property and every bond, suit, judgment and execution heretofore or hereafter made with intent to defeat, hinder, delay or defraud creditors or others of their just and lawful actions, suits, debts, accounts, damages, penalties or forfeitures are void as against such other persons and their assigns.Was the transfer made with the intent to defeat, hinder, delay or defraud the defendant’s creditors, making the transfer void under section 2 of the Fraudulent Conveyances Act (FCA)?.The issues considered by the court were as follows: The defence responded with a summary judgment motion of its own, seeking a dismissal of the action based on the expiry of the limitation period. The plaintiff then brought a motion for summary judgment. The Plaintiff commenced an action to reverse the transfer of title to the property in May 2019. The house had a fair market value of $2.625 million at the time of the transfer but was sold for only two dollars. At the time of the transfer, the defendant owed money to several parties, including the plaintiff. On searching the title to the defendant’s home the plaintiff discovered that it had been transferred from the defendant to his spouse in September 2015. The plaintiff prepared to collect and arranged an Examination in Aid of Execution to assess the defendant’s assets. The plaintiff sued in January 2018 for the balance and the parties eventually agreed to a consent judgment for $47,727.56 plus costs of $14,000. The parties settled but the defendant client did not make all the required payments. The plaintiff, a lawyer and creditor, was owed money from his client for whom he had provided legal representation before the Ontario Securities Commission (OSC). Debtor Transfers Property to Spouse for Nominal Amount Drabinsky is a summary judgment decision from the Ontario Superior Court (ONSC) with guidance for creditors on how to approach issues relating to discoverability and limitation periods if they suspect their debtors’ real property has been fraudulently conveyed.
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