Transactions to Defeat Creditors

If a person enters into a transaction (prior to becoming bankrupt) with the prime purpose of the transaction is to defeat creditors (ie keep the money or property out of the reach of their creditors) then in certain circumstances the transaction (after bankruptcy) can be set aside by the Bankruptcy Trustee.

There is no time limit involved under this section. The trustee can void transactions made at any time before the bankruptcy, as long as the conditions as set out in the Bankruptcy Act have been met.

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