Actio Pauliana

The Actio Pauliana is the legal possibility for a creditor to set aside a prejudicial legal act. The underlying principle is that any creditor with a sufficient interest is entitled to this action. A legal act is voidable: “if a debtor, when performing an unobligatory legal act, knew or should have known that it would result in prejudice to one or more creditors in their ability to recover”.

There must be

  1. an unobligatory legal act (except for the possibility of a trustee in bankruptcy to set aside an obligatory legal act under certain circumstances, also under Article 47 Bankruptcy Act, of which
  2. the debtor (and usually the creditor) knew or should have known that it could be prejudicial, while
  3. the prejudice actually materialised.

If these criteria are met, the legal act is voidable and the ground for annulment can be invoked by any creditor whose rights of recovery are adversely affected by the legal act, regardless of whether his claim arose before or after the act. It will usually involve the transfer or encumbrance – the establishment of a pledge or a right of mortgage A mortgage is a limited right given by a debtor on an asset intended as a security for the creditor that performances are fulfilled.
» Meer over mortgage
– of an asset. A legal act voidable under the above criteria is also referred to as “fraudulent”.

In practice, it is not always easy to prove that the second criterion (knowledge of prejudice) has been met. Although the Supreme Court ruled in ABN v Van Dooren qq III that there is already knowledge of prejudice if it can be foreseen “with a reasonable degree of probability”, the law provides for a reversal of the burden of proof in certain cases: if there is a transaction with affiliated persons and/or companies (predominantly equal directors and/or shareholders), there is a presumption of knowledge of prejudice, and it is up to the party sued to refute this presumption.

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