Summary
This Appellate Division decision reverses a lower court order denying summary judgment in a CPLR Article 52 turnover proceeding brought by a judgment creditor. The court held that the petitioner established prima facie entitlement to judgment on claims alleging fraudulent conveyances under former Debtor and Creditor Law §§ 273 and 276, as the debtor transferred assets without fair consideration while insolvent and retained control of the property. Additionally, the court found sufficient evidence to compel a bank to turn over the contents of a safe deposit box jointly held by the judgment debtor and a third party to satisfy the outstanding judgment.
Topics
Practice areas
Questions Presented
- Whether summary judgment was proper on the D&C Law §§ 273 and 276 claims.
- Whether the turnover petition against JPMorgan Chase Bank should be granted.
Holdings
- Summary judgment is proper where the petitioner establishes a prima facie entitlement to judgment as a matter of law under §§ 273 and 276 and the respondents fail to raise a triable issue of fact.
- Turnover is granted when the petitioner shows that the judgment debtor is entitled to possession of the property or that the judgment creditor's rights are superior to those of the transferee.
Key quotations
“CPLR 5225(b) provides for an expedited special proceeding by a judgment creditor to recover money or other personal property belonging to a judgment debtor against a person in possession or custody of money or other personal property in which the judgment debtor has an interest in order to satisfy a judgment”
Factual background
Deborah Schiffman sought to enforce a judgment of $338,778.72 against Affordable Shoes, Ltd. and guarantor Zakhar Brener. She moved for summary judgment on claims under Debtor and Creditor Law §§ 273 and 276 and for the turnover of a safe deposit box held by JPMorgan Chase Bank. Brener had transferred real property to a trust without fair consideration, allegedly fraudulently, and retained use of the property.
Procedural history
The petitioner commenced a CPLR 52 proceeding seeking turnover of a safe deposit box and real property to satisfy a judgment. The Supreme Court, Kings County denied summary judgment on the D&C Law claims and the turnover request. The petitioner appealed.