The Trustee in Bankruptcy sought declarations that a property sale by the bankrupt, Ian Ross McSevney, to a corporation controlled by his sister, Elaine McSevney, was a transfer at undervalue under section 96 of the Bankruptcy and Insolvency Act, and that Elaine McSevney was privy to the transfer.
The court found that the relationship between the siblings was not arm's length, that the bankrupt was insolvent or rendered insolvent by the transfer, and that he intended to defraud, defeat, or delay creditors.
The court determined the fair market value of the property and the actual consideration paid, concluding that the transfer was conspicuously less than fair market value.
The motion was granted, and Elaine McSevney and her corporation were ordered to pay the difference to the Trustee.
