fraudulent transfer claim in California

2025As the trial court correctly pointed out, however, “A fraudulent conveyance is a transfer by the debtor of property to a third person undertaken with the intent to prevent a creditor from reaching that interest to satisfy its claim.” (Yaesu Electronics Corp. v. Tamura (1994) 28 Cal.App.4th 8, 13 ; Kirkeby v. Superior Court (2004) 33 Cal.4th 642, 648 ; see Civ Code, § 3439.04.) In concluding that the Shens failed to prove a fraudulent transfer claim meeting these elements, the trial court made three findings.

2015The plaintiff in Kirkeby , like the Muse Parties here, only filed a fraudulent transfer claim to void the transfers “to the extent necessary to satisfy the claims set forth in her complaint.” (Kirkeby, supra, 33 Cal.4th at p. 646 .) In Kirkeby , there were 26 other claims that did not involve the real property.

2025Damages claims such as costs of suit may “fall within the scope of recoverable tort damages and satisfy the damage element for a fraudulent transfer claim for purposes of demurrer.” (Berger v. Varum, supra, 35 Cal.App.5th at p. 1021 .) Thus, Orion has stated a viable claim for damages. 9 Thus, Orion’s complaint adequately stated a cause of action for fraudulent transfer under a conspiracy theory and/or an aiding and abetting theory of liability.

2025Damages claims such as costs of suit may “fall within the scope of recoverable tort damages and satisfy the damage element for a fraudulent transfer claim for purposes of demurrer.” (Berger v. Varum, supra, 35 Cal.App.5th at p. 1021 .) Thus, Orion has stated a viable claim for damages.9 Thus, Orion’s complaint adequately stated a cause of action for fraudulent transfer under a conspiracy theory and/or an aiding and abetting theory of liability.

2019(See Brown , supra , 247 Cal.App.4th at p. 279 , 201 Cal.Rptr.3d 892 ["We accept as true all well-pleaded allegations in the operative complaint"].) Certain cases, while not awarding consequential damages, have recognized the availability of such damages. 6 For example, in Mehrtash, supra , 93 Cal.App.4th 75 , 112 Cal.Rptr.2d 802 , the plaintiff ex-wife obtained a judgment for unpaid spousal support and sought to have a quitclaim deed given by her former husband to his stepchildren set aside under the UFTA.

2019(See Brown , supra , 247 Cal.App.4th at p. 279 , 201 Cal.Rptr.3d 892 ["We accept as true all well-pleaded allegations in the operative complaint"].) Certain cases, while not awarding consequential damages, have recognized the availability of such damages. 6 For example, in Mehrtash, supra , 93 Cal.App.4th 75 , 112 Cal.Rptr.2d 802 , the plaintiff ex-wife obtained a judgment for unpaid spousal support and sought to have a quitclaim deed given by her former husband to his stepchildren set aside under the UFTA.

2019The Varum defendants rely on Cardinale v. Miller (2014) 222 Cal.App.4th 1020 , 166 Cal.Rptr.3d 546 , to contend the complaint is actually an action to enforce a judgment rather than a fraudulent transfer claim.

2019The Varum defendants rely on Cardinale v. Miller (2014) 222 Cal.App.4th 1020 , 166 Cal.Rptr.3d 546 , to contend the complaint is actually an action to enforce a judgment rather than a fraudulent transfer claim.

2025As the trial court correctly pointed out, however, “A fraudulent conveyance is a transfer by the debtor of property to a third person undertaken with the intent to prevent a creditor from reaching that interest to satisfy its claim.” (Yaesu Electronics Corp. v. Tamura (1994) 28 Cal.App.4th 8, 13 ; Kirkeby v. Superior Court (2004) 33 Cal.4th 642, 648 ; see Civ Code, § 3439.04.) In concluding that the Shens failed to prove a fraudulent transfer claim meeting these elements, the trial court made three findings.

2022But Rossen v. Villanueva (1917) 175 Cal. 632 and Thomas v. Lavery (1932) 125 Cal.App. 666, 667 , on which the buyers rely for this proposition, are no longer good law.

2022(See Nautilus, Inc. v. Yang (2017) 11 Cal.App.5th 33 , 36 & fn. 2.) 8 the trial court erred by sustaining the demurrer to the first cause of action.

2022But Rossen v. Villanueva (1917) 175 Cal. 632 and Thomas v. Lavery (1932) 125 Cal.App. 666, 667 , on which the buyers rely for this proposition, are no longer good law.

2019(Cf. Rossberg v. Bank of America, N.A. (2013) 219 Cal.App.4th 1481 , 1499–1500 [demurrer sustained as to fraud claim because plaintiffs “failed to allege any connection between their reliance . . . and any specific damages that reliance caused”].) 6 scope of recoverable tort damages and satisfy the damage element for a fraudulent transfer claim for purposes of demurrer.

2016Where one corporation purchases or acquires by transfer the assets of another corporation, California has a general rule of "successor nonliability." (Fisher v. Allis- Chalmers Corp. Product Liability Trust (2002) 95 Cal.App.4th 1182, 1188 .) Exceptions to this general rule exist where "(1) there is an express or implied agreement of assumption; (2) the transaction amounts to a consolidation or merger of the two corporations, (3) the purchasing corporation is merely a continuation of the seller; or (4) the transfer of assets to the purchaser is for the fraudulent purpose of escaping liability

2016Where one corporation purchases or acquires by transfer the assets of another corporation, California has a general rule of "successor nonliability." (Fisher v. Allis- Chalmers Corp. Product Liability Trust (2002) 95 Cal.App.4th 1182, 1188 .) Exceptions to this general rule exist where "(1) there is an express or implied agreement of assumption; (2) the transaction amounts to a consolidation or merger of the two corporations, (3) the purchasing corporation is merely a continuation of the seller; or (4) the transfer of assets to the purchaser is for the fraudulent purpose of escaping liability

2015(Macedo, supra, 86 Cal.App.4th at p. 1051 & fn. 6.) As the court held, Code of Civil Procedure section 338, subdivision (d), “applies equally to litigation, such as this, timely commenced after entry of a court order that first establishes the existence of a creditor-debtor relationship, although outside of the period of limitations established by the UFTA.” (Macedo, supra, at p. 1051, fn. 6.) Indeed, in Macedo and Estate of Myers, supra, 139 Cal.App.4th at p. 437 , the underlying action was not pending at the time the action for fraudulent transfer was filed.

2014Although the district court in MFS/Sun Life Trust-High Yield Series v. Van Dusen Airport Services (S.D.N.Y 1995) 910 F.Supp. 913 observed that “a settlement with the debtor can . . . preserve the creditor’s claims against transferees” (id. at p. 932), the court acknowledged that “[i]f the debt is satisfied, the creditor no longer has a cause of action to recover assets conveyed by the debtor to a transferee” (id. at p. 931).