Fraudulent Conveyance under Section 36A of the Conveyancing Act 1979

Robin J. Mayor • Posted 03/05/2011 • Under Articles

Section 36A of the Conveyancing Act is a somewhat complicated provision which enables an eligible creditor to set aside every disposition made with the dominant intention to put property beyond the reach of creditors. The disposition must be a disposition at an undervalue.

It is essential that the disposition be both carried out with the dominant intention to put the property beyond the reach of creditors and at an undervalue. An undervalue means a transaction for either no consideration or where the value of the consideration is in money or monies worth significantly less than the value of the property disposed of. The test is a civil test, ie. the standard of proof is on the balance of probability.

The section contains three definitions of eligible creditors who are defined by reference to the type of debt and the time when they became creditors.