solution

In 1991 Joseph and Toni Trujillo bought a house in Las Vegas, Nevada. Subsequently, Joseph borrowed $20,000 of his wife’s savings to invest in business ventures. On November 15, 1993, the Trujillos defaulted in payment on a promissory note to Richard Hart and then entered into a stipulated agreement with him that was entered as a judgment on August 8, 1994. In May of 1994, purportedly as security to his wife for the $20,000 loan, Joseph transferred the title to his Cadillac automobile to his son, Gilbert. Joseph instructed Gilbert to hold the title in trust until the loan was repaid. Later the Trujillos transferred to Gilbert the titles of two more vehicles, a Pontiac and a Volkswagen, purportedly to obtain a group insurance rate. No consideration was given for the transfer of any of the vehicles, and the Trujillos retained possession and control of all three vehicles. On August 22, 1994, the Trujillos deeded, by a quit claim deed, their house to their daughter, Valerie Aquino. The transfer was purportedly done to obtain a loan with Aquino’s credit because Joseph’s outstanding debts prevented him from obtaining credit in his own name. No consideration was given to the Trujillos for the transfer of the house, and the Trujillos retained both possession and control of the house. On May 16, 1995, within a year of transferring the vehicles and deeding the house, the Trujillos filed a petition for relief under Chapter 7 of the Bankruptcy Code. The Bankruptcy Trustee, Tom Grimmett, filed a complaint for fraudulent conveyance, requested denial of discharge against the Trujillos, and sought recovery of the fraudulently conveyed property from Gilbert and Aquino. Were the transfers of the vehicles and the house fraudulent transfers that could be recovered by the trustee?

 
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