Court Limits A 'Self-Settling Trust Or Similar Device' To An Express Trust
Mondaq Business Briefing › United States Law Articles in English (2011)
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Court Limits A 'Self-Settling Trust Or Similar Device' To An Express Trust
In In re Porco Inc., the Bankruptcy Court for the Southern District of Illinois in a March 30 opinion addressed an issue of apparent first impression: whether a resulting or constructive trust is a "self-settling trust or similar device" subject to the trustee's avoidance power under § 548(e). In holding that the "similar device" clause is limited to express trusts, the court significantly limited the scope of a trustee's power to avoid and recover transfers by or on behalf of a debtor to a related third party.
Background of the Doctrine Section 548(e) is composed of four elements that must all be met in order for the trustee...See the full content of this document
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