The Hawkins Law Firm
256.571.2829

400 Gunter Avenue
Guntersville, AL 35976

256.705.3593

600 Boulevard South SW Suite 104
Huntsville, AL 35802

256.586.4510

942 N. Main Street
Arab, AL 35016

Business Law Newsletter

Fraudulently Transferred Property & Constructive Trusts

A constructive trust is a remedy imposed by a court when a person has wrongfully attained property in an inappropriate way. The court will undo the transaction and order that title to the property go to the rightful owner.

Types of Wrongful Conduct

Any wrongful activity that leads to the unfair obtainment of property may be cause for a constructive trust, including:

  • Fraud (including forgery)
  • Theft (including embezzlement)
  • Accident
  • Mistake
  • Undue influence
  • Violation of fiduciary duty (for example, where a partner purchases property in his own name rather than in the name of the partnership)

Factors

In order for a constructive trust to be created, the following factors must exist:

  • Fraudulent representations or concealment of important and material information, or breach of trust
  • Acts such as transfer of property as a result of the fraud or breach
  • Profit and/or unjust enrichment as a result of fraudulent representation or concealment of important and material information

Remedy Under Constructive Trusts

A constructive trust is imposed when an affected party initiates a lawsuit requesting relief. It typically provides that the property pass from the wrongful owner to the rightful owner.

However, if the unlawful owner has damaged or destroyed any of the property, the rightful owner is entitled to a money judgment for the value of the property.

Business Law News Links
Designed and Powered by NextClient

© 2015 - 2019 Hawkins Law Firm, LLC. All rights reserved.
Custom WebShop™ law firm website design by NextClient.com.

Contact Form Tab