EPTL § 7-1.3

Purchase-money resulting trust abolished · as in force on May 31, 2026

§ 7-1.3 Purchase-money resulting trust abolished

(a) A disposition of property to one person for a valuable consideration paid, in whole or in part, by another is presumed fraudulent as against the creditors of the payor at the time of such disposition and, unless the presumption is rebutted, a trust results in favor of such creditors to the extent necessary to satisfy their claims; but title to the property vests in the transferee and no trust results to the payor unless the transferee either:

(1) Takes such property, in his own name, as an absolute transfer without the consent or knowledge of the payor; or

(2) In violation of some trust, purchases the property so transferred with money or property belonging to another.

Official sourcehttps://www.nysenate.gov/legislation/laws/EPT/7-1.3

In plain English

When one person pays for property but title is put in another's name, no trust results for the payer; the payer's creditors are protected instead.

(a) A transfer to one person paid for, in whole or in part, by another is presumed fraudulent against the payor's creditors at the time of the transfer; unless the presumption is rebutted, a trust results for those creditors to the extent needed to satisfy their claims. Otherwise title vests in the transferee and no trust results to the payor ★ unless the transferee either:
(1) took the property in his own name, as an absolute transfer, without the payor's consent or knowledge; or ★
(2) in violation of some trust, bought the property with money or property belonging to another.

Marked in the text: penalties, time limits, sums of money. Editorial emphasis added by this edition; it does not appear in the statute as enacted.

In print

This provision appears in Volume 1 — The Surrogate's Court in Plain English; Volume 3 — The Surrogate's Court: Court Rules & the EPTL; Volume 5 — Your Career: Surrogate's Court in Plain English.