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Haines v. West

SUPREME COURT OF THE STATE OF NEW YORK Appellate Division, Fourth Judicial Department
Oct 4, 2019
176 A.D.3d 1619 (N.Y. App. Div. 2019)

Opinion

899 CA 19–00269

10-04-2019

Peter L. HAINES and Minnie H. Brennan, as Co–Executors of the Estate of Patricia S. Haines, Deceased, Plaintiffs–Respondents, v. Holly WEST, Also Known as Holly W. West, and William J. Hurlburt, Individually, and Doing Business as Milton R. Hurlburt, Defendants–appellants.

CARMEL, MILAZZO & DICHIARA LLP, NEW YORK CITY (CHRISTOPHER P. MILAZZO OF COUNSEL), FOR DEFENDANT-APPELLANT HOLLY WEST, ALSO KNOWN AS HOLLY W. WEST. SHULTS & SHULTS, HORNELL (DAVID SHULTS OF COUNSEL), FOR DEFENDANT-APPELLANT WILLIAM J. HURLBURT, INDIVIDUALLY, AND DOING BUSINESS AS MILTON R. HURLBURT. DAVIDSON FINK LLP, ROCHESTER (DAVID L. RASMUSSEN OF COUNSEL), FOR PLAINTIFFS-RESPONDENTS.


CARMEL, MILAZZO & DICHIARA LLP, NEW YORK CITY (CHRISTOPHER P. MILAZZO OF COUNSEL), FOR DEFENDANT-APPELLANT HOLLY WEST, ALSO KNOWN AS HOLLY W. WEST.

SHULTS & SHULTS, HORNELL (DAVID SHULTS OF COUNSEL), FOR DEFENDANT-APPELLANT WILLIAM J. HURLBURT, INDIVIDUALLY, AND DOING BUSINESS AS MILTON R. HURLBURT.

DAVIDSON FINK LLP, ROCHESTER (DAVID L. RASMUSSEN OF COUNSEL), FOR PLAINTIFFS-RESPONDENTS.

PRESENT: WHALEN, P.J., SMITH, CENTRA, NEMOYER, AND TROUTMAN, JJ.

MEMORANDUM AND ORDER It is hereby ORDERED that the order and judgment so appealed from is unanimously reversed on the law without costs and the motion is denied.

Memorandum: Plaintiffs commenced this action seeking, inter alia, to set aside as a fraudulent conveyance a default judgment entered against defendant Holly West, also known as Holly W. West, in favor of defendant William J. Hurlburt, individually and doing business as Milton R. Hurlburt. Defendants now appeal from an order and judgment that granted plaintiffs' motion for summary judgment on the third and fourth causes of action, for violations of Debtor and Creditor Law § 276 and for attorneys' fees under section 276–a, respectively. We reverse.

Debtor and Creditor Law § 276 provides that "[e]very conveyance made and every obligation incurred with actual intent ... to hinder, delay, or defraud either present or future creditors, is fraudulent as to both present and future creditors." To meet his or her initial burden in moving for summary judgment with respect to a section 276 cause of action, a plaintiff must establish the requisite intent to hinder, delay, or defraud by "clear and convincing evidence" ( Jensen v. Jensen, 256 A.D.2d 1162, 1163, 682 N.Y.S.2d 774 [4th Dept. 1998] ). "[B]ecause direct evidence of fraudulent intent is often elusive, courts will consider badges of fraud which are circumstances that accompany fraudulent transfers so commonly that their presence gives rise to an inference of intent" ( A & M Global Mgt. Corp. v. Northtown Urology Assoc., P.C., 115 A.D.3d 1283, 1288, 983 N.Y.S.2d 368 [4th Dept. 2014] [internal quotation marks omitted] ).

We agree with defendants that plaintiffs failed to meet their initial burden with respect to the section 276 cause of action because they did not eliminate triable issues of fact with respect to defendants' alleged fraudulent intent. We note that "the presence of one or more badges of fraud does not necessarily compel the conclusion that a conveyance is fraudulent" ( id. at 1288–1289, 983 N.Y.S.2d 368 ; see Skiff–Murray v. Murray, 17 A.D.3d 807, 811, 793 N.Y.S.2d 243 [3d Dept. 2005] ). Here, "[a]lthough the submitted facts establish ... ‘badges of fraud’ indicative of fraudulent intent ..., they fail to establish defendant[s'] fraudulent intent as a matter of law" ( Taylor–Outten v. Taylor, 248 A.D.2d 934, 935, 670 N.Y.S.2d 295 [4th Dept. 1998] ).

We further conclude that, inasmuch as triable issues of fact exist with respect to defendants' actual intent to hinder, delay, or defraud, plaintiffs also failed to establish their entitlement to an award of attorneys' fees pursuant to Debtor and Creditor Law § 276–a (see id.; cf. Posner v. S. Paul Posner 1976 Irrevocable Family Trust, 12 A.D.3d 177, 179, 784 N.Y.S.2d 509 [1st Dept. 2004] ).


Summaries of

Haines v. West

SUPREME COURT OF THE STATE OF NEW YORK Appellate Division, Fourth Judicial Department
Oct 4, 2019
176 A.D.3d 1619 (N.Y. App. Div. 2019)
Case details for

Haines v. West

Case Details

Full title:PETER L. HAINES AND MINNIE H. BRENNAN, AS CO-EXECUTORS OF THE ESTATE OF…

Court:SUPREME COURT OF THE STATE OF NEW YORK Appellate Division, Fourth Judicial Department

Date published: Oct 4, 2019

Citations

176 A.D.3d 1619 (N.Y. App. Div. 2019)
110 N.Y.S.3d 183
2019 N.Y. Slip Op. 7186

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