The Trustee in bankruptcy sought to set aside alleged transfers at undervalue made by the bankrupt to his estranged spouse and two sons in the two years prior to bankruptcy.
The court found the payments made in the year immediately preceding bankruptcy to be transfers at undervalue, as the respondents failed to provide compelling corroborating evidence for an alleged oral separation agreement.
However, the court found the bankrupt was not insolvent at the time of the payments made in the second year prior to bankruptcy, thus those transfers were not set aside.
