Section 1717/Special Fee Shifting Statute: Losing Plaintiffs’ Efforts To Recoup Monies Under Uniform Fraudulent Transfer Act Did Not Give Rise To Fee Exposure

 

None Under Either Section 1717 or the UFTA.

     The Fourth District, Division 1 in Levine v. McAvoy, Case No. D058894 (4th Dist., Div. 1 Aug. 2, 2012) (unpublished) decided that fee exposure was correctly not visited upon losing plaintiffs seeking to recoup monies from third-party transferees under the Uniform Fraudulent Transfer Act (UFTA). Because fraudulent conveyance was the theory of the action, contractual fee exposure could not be imposed upon the nonsignatory plaintiffs. Also, the UFTA has no fee authorizing provision, with the “any other relief as the circumstances may require” language of Civil Code section 3439.07(a)(3)(c) not being the equivalent of a legislative mandate on the subject.

     BLOG UNDERVIEW–Our local Santa Ana appellate court, in an unpublished decision authored by Justice Ikola in 2008, reached the same conclusion about the UFTA having no fee shifting entitlement, citing out of state decisions that were in accord on the issue. (See Palacio Del Mar Homeowners Assn. v. McMahon, Case No. G039731 (4th Dist., Div. 3 Dec. 1, 2008) (unpublished) [discussed in our Dec. 2, 2008 post].)

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