Robinson v. Coughlin

Summary

The Connecticut Supreme Court held that a transferee of fraudulently transferred assets could not be held liable for damages under the Uniform Fraudulent Transfer Act when the transferee reconveyed the assets to the debtor and the creditor did not claim that the assets had depreciated in value. The court concluded that avoidance was no longer available after reconveyance and that the statutory provision authorizing other relief did not permit an unrestricted damages award. The court affirmed the trial court’s judgment for the transferee.

Holdings

1. A transferee may not be held liable for damages under the Uniform Fraudulent Transfer Act when the transferee reconveys the fraudulently transferred assets to the debtor, retains no proceeds, and the creditor does not claim that the property depreciated in value between the initial transfer and the reconveyance.
2. The Uniform Fraudulent Transfer Act is not a wholesale codification of the common law and its remedies extend beyond the common-law property-and-proceeds rule, although the common-law rule remains generally applicable when a transferee reconveys the property and retains no proceeds.

Questions Presented

1. Whether a transferee of fraudulently transferred assets may be held liable for damages under the Uniform Fraudulent Transfer Act when the transferee reconveys the assets to the debtor, retains no proceeds, and the assets did not depreciate in value while in the transferee's possession.
2. Whether the Uniform Fraudulent Transfer Act expands a creditor's remedies beyond the common-law property-and-proceeds rule.

Disposition

affirmed