Section 6.44 Other Avoidances

• Library: Bankruptcy Practice (2007 Ed. + 2015 Cum Supp)

B. (§6.44) Other Avoidances

The trustee has the power to avoid any transfer of the debtor’s interest in property or any obligation incurred by the debtor that is voidable under applicable law by a creditor holding an unsecured claim that is allowable under the Bankruptcy Code. 11 U.S.C. § 544(b). See In re Popkin & Stern, 223 F.3d 764 (8^th Cir. 2000), appeal after remand, 263 B.R. 885 (8^th Cir. 2000), holding that the Bankruptcy Code gives the trustee whatever rights an unsecured creditor might have under applicable state or federal law. There must be an actual unsecured creditor whose rights the trustee can use. The trustee’s use of this power relies heavily on the state fraudulent conveyance laws.

In Missouri, the relevant fraudulent transfer statutes are §§ 428.005 et seq., RSMo 2000. Specific creditor remedies are found in § 428.039, RSMo 2000. This could also include any other state law that would allow an unsecured creditor to prevail against the debtor or a creditor of the debtor. SeeIn re Van Vleck, 211 B.R. 689 (Bankr. E.D. Mo. 1997)...