Fraudulent transfer ?

[hernandes]

What is the name of your state (only U.S. law)? FL

My brother and I live in Orlando and we are from Honduras. We visited Honduras in September 2010 and I had a serious accident at that time. My brother borrowed money from his friends in Honduras and lent me around 20,000 US dollars for my treatment. I gave my brother a Promissory Note (PN) for that. I signed this PN during October 2010 when we both were in Honduras. The PN was created and signed as per Honduran law. We came back to US a few months after that. During that time, my brother and I are permanent residents (green card holders) of US but we both are Honduran citizens (we have Honduran passports) at that time. In 2012, we both became US citizens.

During August 2013, I paid 2,000 dollars back to my brother and I paid it in cash.

In December 2014, I paid back my brother the remaining 18,000 US dollars. I made this payment by transferring money from my US bank account to his US bank account. After that, we both signed on the back of the PN stating that the loan was paid in full and the PN is void (and my brother returned back that PN to me). Luckily I still have that PN with me.

I was facing a lawsuit on a civil matter. Last week the court ordered me to pay 30,000 dollars in the final judgment. The Plaintiff is threatening that he will argue that the money I transferred to my brother in December 2014 is fraudulent transfer and that he will file another lawsuit (to recover money from me) and that he may include my brother also as a defendant to get that 18,000 dollars back from my brother. He is saying that he has 4 year time to do this. I have no other assets.

Can I show the PN (which is with me now and which was signed in Honduras) to the US court to prove that I borrowed money from my brother in 2010 when we were in Honduras to get my medical treatment? Our passports also prove that we were in Honduras at that time. In other words, can I show my passport, PN, and related documents to prove that the money transfer in December 2014 was not fraudulent transfer (as the Plaintiffs claim) but was legitimate? If needed, my brother is ready to testify in my support. Also I have friends in US who are aware of this entire ordeal (including my accident, my brother lending me money, etc) that I faced since 2010.

What can I do to prove that the money transfer was not fraudulent transfer in case the plaintiff files lawsuit for money recovery?

 

[tranquility]

Prove the note was for a valid debt.

http://www.leg.state.fl.us/Statutes/index.cfm?App_mode=Display_Statute&URL=0700-0799/0726/0726.html

 

[hernandes]

Thanks Tranquility.

I talked to Honduran attorney. He said that Honduran PN is valid for 3 years from the date it is originally signed. After that, if any partial payment is made and the payment details are mentioned on back of the PN and signed by both parties (on the back) then the PN is valid for another 3 years starting from the date on which both the parties signed on the back. Like this, the PN will continue until it is completely paid. However, if there was no (partial) payment for 3 consecutive years then the PN is invalid.

Based on what the Honduran attorney said, the PN was valid until December 2014.

The lawsuit was filed (on me) during May 2013 and final judgment was given during January 2016.

I am still unsure on what I need to “Prove the note was for a valid debt”

Whether the PN initially executed and signed in Honduras is valid in Florida?

 

[quincy]

Thanks Tranquility.

I talked to Honduran attorney. He said that Honduran PN is valid for 3 years from the date it is originally signed. After that, if any partial payment is made and the payment details are mentioned on back of the PN and signed by both parties (on the back) then the PN is valid for another 3 years starting from the date on which both the parties signed on the back. Like this, the PN will continue until it is completely paid. However, if there was no (partial) payment for 3 consecutive years then the PN is invalid.

Based on what the Honduran attorney said, the PN was valid until December 2014.

The lawsuit was filed (on me) during May 2013 and final judgment was given during January 2016.

I am still unsure on what I need to “Prove the note was for a valid debt”

Whether the PN initially executed and signed in Honduras is valid in Florida?

You were loaned $20,000 by your brother but your brother borrowed this $20,000 from his friends. You paid your brother back but did your brother ever pay his friends back? They are the ones who are owed the money.

 

[LdiJ]

You were loaned $20,000 by your brother but your brother borrowed this $20,000 from his friends. You paid your brother back but did your brother ever pay his friends back? They are the ones who are owed the money.

I think that you are misunderstanding what is going on. I do not believe that the lawsuit where he was ordered to pay 30k has anything to do with the previous loan. I believe that the person who received the judgment in the lawsuit is researching his past finances, discovered that 20k was paid to his brother, and wants to try to bring that 20k back to go towards his judgment. That is why he is calling it a fraudulent transfer.

OP, can you come up with any documentation regarding your medical bills that you paid for with the original loan money? That would help prove that the debt was valid.

 

[hernandes]

Thanks Quincy and LdiJ

For your information: the lawsuit was filed in Orlando, Florida and the person who filed that lawsuit is not a Honduran person (and I don’t think he had ever been to Honduras in his life). He has no relation with my brother or anyone who loaned money to my brother. The lawsuit was in relation to a civil matter that took place between me and that person in Florida.

To Quincy:
In 2011, my brother’s wife (who was very kind) visited Honduras and gave her expensive jewelry to my brother’s friends in Honduras in exchange to the loan my brother took from his friends.

To LdiJ:
Currently I do not have medical bills in my hand but I can easily get a letter from the hospital in Honduras confirming my accident and the amount I have paid them, and it is not an issue. In fact, I permanently lost two of my hand finders in that accident and I can show my hand to the court. Also, my wife’s brother was injured in that accident and unfortunately, he later died due to those injuries (I can bring his death certificate also if needed).

 

[quincy]

I think that you are misunderstanding what is going on. I do not believe that the lawsuit where he was ordered to pay 30k has anything to do with the previous loan. I believe that the person who received the judgment in the lawsuit is researching his past finances, discovered that 20k was paid to his brother, and wants to try to bring that 20k back to go towards his judgment. That is why he is calling it a fraudulent transfer.

OP, can you come up with any documentation regarding your medical bills that you paid for with the original loan money? That would help prove that the debt was valid.

It is entirely possible that I am misunderstanding what is going on.

That said, if hernandez can show that the $20,000 he paid his brother in 2014 was then in turn paid to the friends in 2014, that can show there was a valid debt and it can also show the time this debt was satisfied.

Of course, if the brother paid back the money he borrowed from his friends earlier (i.e., before 2014), this will not work to show that the 2014 transfer of funds from brother to brother was not an attempt to hide assets.

The medical bills, as a note, would show the amount hernandez owed, and if/when these bills were paid, but they would not show if the bills were paid with borrowed funds. I assume you are looking at the bills as a way to show how much would have been needed to pay off the hospital (i.e., if the bills only amounted to $5000, a $20,000 loan would not have been needed)?

 

[LdiJ]

Thanks Quincy and LdiJ

For your information: the lawsuit was filed in Orlando, Florida and the person who filed that lawsuit is not a Honduran person (and I don’t think he had ever been to Honduras in his life). He has no relation with my brother or anyone who loaned money to my brother. The lawsuit was in relation to a civil matter that took place between me and that person in Florida.

To Quincy:
In 2011, my brother’s wife (who was very kind) visited Honduras and gave her expensive jewelry to my brother’s friends in Honduras in exchange to the loan my brother took from his friends.

To LdiJ:
Currently I do not have medical bills in my hand but I can easily get a letter from the hospital in Honduras confirming my accident and the amount I have paid them, and it is not an issue. In fact, I permanently lost two of my hand finders in that accident and I can show my hand to the court. Also, my wife’s brother was injured in that accident and unfortunately, he later died due to those injuries (I can bring his death certificate also if needed).

Get that documentation from the hospital ASAP. You will want to have that on hand now.

 

[quincy]

Thanks Quincy and LdiJ

For your information: the lawsuit was filed in Orlando, Florida and the person who filed that lawsuit is not a Honduran person (and I don’t think he had ever been to Honduras in his life). He has no relation with my brother or anyone who loaned money to my brother. The lawsuit was in relation to a civil matter that took place between me and that person in Florida.

To Quincy:
In 2011, my brother’s wife (who was very kind) visited Honduras and gave her expensive jewelry to my brother’s friends in Honduras in exchange to the loan my brother took from his friends.

To LdiJ:
Currently I do not have medical bills in my hand but I can easily get a letter from the hospital in Honduras confirming my accident and the amount I have paid them, and it is not an issue. In fact, I permanently lost two of my hand finders in that accident and I can show my hand to the court. Also, my wife’s brother was injured in that accident and unfortunately, he later died due to those injuries (I can bring his death certificate also if needed).

Thanks, hernandez. My post apparently crossed with your post.

So the person suing you is simply looking for assets. And this person believes you are hiding assets?

Okay. I then agree with LdiJ that you might have to rely on the medical bills and a report from the hospital to help you support the reason for the transfer of funds from you to your brother - and further you will want to show that the $20,000 was actually given to your brother by his friends in Honduras for your benefit. This might require witness testimony, if it gets to that point.

 

[hernandes]

Many thanks Quincy and LdiJ.

LdiJ : I will have the letter from hospital.

Quincy: yes, he is looking for assets and believes I am hiding assets. I will arrange the letter describing the treatment plus the total amount I have paid to the hospital. I will be prepared for witness testimony as well.

Hope Florida court will accept and recognize all these documents (written in English) issued in Honduras.

 

[Just Blue]

It is entirely possible that I am misunderstanding what is going on.

VERY understandable!!