Consumer Bankruptcy Journal Fall 2016 - Page 27

CLAWBACK PERIODS The Burden of Proof Remains Once the United States creditor exists, life is not necessarily easy. The trustee still must prove that the transfer was without value or that there was a lack of solvency at the time of the transfer. With the expanded time periods afforded by the FDCPA, evidentiary documents to establish proof become less available. And, abstract concepts such as proving whether the debtor was engaged or was about to engage in a business transactions which made payment to creditors implausible or whether the business or transactions of the debtor made the debtor unable to pay debts when they became due37 B could become oppressively burdensome to prove without the readily available documents.00 Conclusion When planning for litigation, an exclusive review of 11 U.S.C. ‘ 546 leaves one to conclude that an action must be filed within two years, and that the avoidable actions under 11 U.S.C. ‘ 547 or 548 would be limited to 90 days, one year or two years. However, alternative limitations= periods are provided by 11 U.S.C. ‘ 544(b) which incorporates applicable law. Some courts have determined 544(b)=s Aapplicable law@ to include federal law. There is a split among courts as to whether or not the Aapplicable law of 544(b) includes the six-year look back period under the FDCPA or the 10-year period of 26 U.S.C. ‘ 6502(a)(1). One group of courts hold that the FDCPA is an exclusive remedy to a governmenta