Research On The Right Of Rescission To Fraudulent Trust

Trust had been used as a tool to deceive the creditor by the debtor at a vey early stage.Different from ordinary fraudulent conduct by a debtor,trust cannot be defined as a pure property transfer because the involved legal relationships are more complicated.Therefore,how to properly balance the protection of creditor and the value of trust law has been an important question.Based on such consideration,legislators in various countries have recognized the importance of a creditor protection system focusing on the fraudulent trust and accordingly a right of rescission to fraudulent trust has been developed.This essay will make a systematic analysis of the right of rescission to fraudulent trust through four parts.The first part mainly starts from the origin and development of the right of rescission to fraudulent trust and separately introduces the legislating attitudes towards the conduct of fraudulent trust in two genealogies of law.In Anglo-American law system countries where the trust origins,fraudulent conduct against creditors are subject to the confinement of anti-fraudulent transaction law and bankruptcy law.As for continental law system countries,any newly developed concept relevant to trust may crash against the traditional civil and commercial legal systems.A major issue is how to deal with the coexistence of the rescission of fraudulent trust and creditor's rights of rescission in contract law.Some countries redefine a new right of rescissionto the fraudulent trust in their trust laws and use a special provision to classify its relationships with the rights of rescission in contract law and bankruptcy law.The second part briefly introduces the legislation design of the right of rescission to the fraudulent trust and essentially deduces its position in our legal system.The key issue in this part is to figure out the detailed relationships between the right of rescission to fraudulent trust under Article 12 of the PRC Trust Law and the creditor's rights of rescission under Article 74 under the PRC Contract Law.The determination of the above subject will directly influence the research into the relationship between the bankruptcy administrators' rights of rescission and the right of rescission to fraudulent trust.Combined with the purpose of legislation,the history of legislation,the comparison of different law systems and context explanation,we can find that the nature of the right of rescission to fraudulent trust is the same as the creditor's rights of rescission though there is no express legal provisions in our country's legislation.The third part specifically emphasizes on the systematic research into the the right of rescission to fraudulent trust based on the conclusion above,which includes the scope,nature of the rights,defendant in litigation and the effect of rescission.Due to the lack of attention to the related areas in our country,we need a lot of current research achievements from the systematic research into the creditor's rights of rescission.However,the distinctiveness of the trust relationships may place a special consideration on such reference,particularly when the actual legal rules of trust law conflicts with the original legal principles in civil law.This Article will use the method of explanation to compare the different value behind various legislation and find reasonableness for the right of rescission to fraudulent trust.The forth part focuses on the concurrence between the right of rescission to fraudulent trust and the bankruptcy administrators' rights of rescission,especially the coordination system between the two rights of rescission.Based on our research findings in the third part,we shall conclude that the bankruptcy administrators' rights of rescission shall prevail in bankruptcy situations.But the PRC Enterprise Bankruptcy Law does not consider the trust relation when designing the bankruptcy administrators' rights of rescission.In order to make the legal assessment morereasonable,we should also consider the legal interests behind the two rights of rescission and explain the execution of the rights by dragging their common parts.