CASE

One evening, Bernardo drinks too much at a party, drives back home, and crashes his car, damaging Carlos’ house. Part of the house has to be rebuilt at significant cost. Bernardo is uninsured. He refuses to pay any compensation to Carlos. Carlos intends to sue Bernardo for damages. When Bernardo hears of this, he donates his house, which is worth a lot of money, to his niece, Maria. By doing so, Bernardo hopes that Carlos will see that it is not worth suing him, as he no longer has assets of value. Maria rents the house for free to Bernardo, helping him out.

Question

Assuming that Carlos is successful in his court case against Bernando, can Carlos take any action to ensure that Bernando's house is available as an asset against which he has recourse for his claim? If so, what action can be taken?

DISCUSSIONS

BELGIUM

Siel Demeyere and Vincent Sagaert

I. Operative Rules

Carlos can take action. He can raise an actio Pauliana.

II. Descriptive Formants

Where a debtor fraudulently organises their own insolvency, the creditor can raise a pauliaanse vordering/action paulienne (Paulian action or revocatory action), the effect of which is that the fraudulent act is not effective against the creditor (but remains valid as between the parties). This means that the creditor can ignore that such an act has taken place, and thus act as if the transferred property is still in the debtor's patrimony. A successful actio Pauliana would, in this case, have the effect that Carlos can act as though Bernardo still owns his house, and can possibly also seize the house.