N. Fraudulent Conveyances and Preferences

• Author: Julien D. Payne - Marilyn A. Payne
• Pages: 470-470

Page 470

A parent’s conveyance of property may be set aside as a fraudulent conveyance under the Statute of Elizabeth, 1570, where the parent had thereby intended to evade obligations to his creditors, including the mother of his children to whom child support was payable pursuant to their divorce judgment. The fact that the fraudulent conveyance was primarily directed at commercial creditors does not preclude the mother from relying on the fraudulent action for the purpose of setting aside the transaction where the mother was clearly a creditor at the time of the transaction, even if the obligor was not then in arrears. No distinction is drawn between past and future support obligations in determining the mother’s priority over other creditors under the Alberta Maintenance Enforcement Act.¹²⁷An obligor’s transfer of property to a close relative may be characterized as fraudulent and declared void under the Statute of Elizabeth, 1570, where there is a pre-existing child support order, even though there has been no default in making the periodic payments as of the date of the transfer.¹²⁸

Where a husband transfers his interest in the jointly owned matrimonial home to his wife in consideration for her waiver of spousal and child support under a separation agreement, third party creditors cannot impugn the conveyance as fraudulent under provincial statute, nor is it void under federal bankruptcy legislation.¹²⁹

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