201 4 IL App (1st) 133008
SECOND DIVISION December 2, 2014

No. 1

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______________________________________________________________________________ NORTHWESTERN MEMORIAL HOSPITAL , ) Appeal from the ) Circuit Court of Plai ntiff

- Appellee, ) Cook County ) v. ) ) FAROU K ADAM SHARIF , ) No. 11 CH 29570 ) Defendant

- Appellant ) ) ( Tierney Sharif , ) Honorable ) Thomas R. Allen , Defendant )

. ) Judge Presiding.

______________________________________________________________________________ JUSTICE PIERCE delivered the judgment of the court , with opinion

. Presiding Justice Simon and J ustice Liu concurred in the judgment and opinion

.

O PINION ¶ 1 Defendant, Farouk Adam Shar i f, appeals the judgment of the circuit co urt of Cook County finding he violated the Uniform Fraudulent Transfer Act ( Act ) ( 740 ILCS 160/1 et seq. (West 2008 ) ) for fraudulently conveying to himself assets of his company to avoid payment to the plaintiff creditor

. Appellant argues: (1) that the tri al court erred by failing to consider all 11 factors of fraud listed in the Act ; and (2) the trial court's judgment was against the manifest weight of the evidence . For the following reasons, we affirm the judgment of the trial court

. ¶ 2 BACKGROUND ¶ 3 I n 2003, Randolph Equities, LLC, a real estate invest ment firm, rented office space at 2111

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2 East Ontario Street, in Chicago, Illinois

. Def endant, Farouk Adam Sharif , 1 was the founder, president , chief executive officer (CEO) , chief operating officer ( C O O ) an d managing member of Randolph Equities until it was involuntarily dissolved in April 2010

. Codefendant, Tierney Sharif, is the ex

- wife of Adam. Plaintiff Northwestern Memorial Hospital acquired ownership of the real estate and the lease in 2008. In Septemb er 2008, Randolph Equities had no money and stopped paying rent owed to Northwestern. ¶ 4 When Randolph Equities abandoned the premises and the lease i n October 2009, plaintiff

sent Adam a certified letter informing him that Randolph Equities was in default a nd that $173,95 2.21 was owed . In November 2009, plaintiff sent Adam , his attorneys, and Randolph Equities' in

- house counsel certified letters informing them of the default and past

- due amounts. In December 2009 , plaintiff filed a lawsuit, separate from thi s litigation, for the unpaid rent (rent litigation) . In June 2010, plaintiff obtained a judgment against Randolph Equities in the amount of $270,333.61. During postjudgment collection proceedings plaintiff learned that Randolph Equities had no assets ; howe ver, it was a named plaintiff in a recently settled 2005 lawsuit against Carbon Capital, Inc. , and Black R ock, Inc

. (Black R ock litigation). ¶ 5 Randolph Equities and the Sharifs brought the Black R ock litigation for breach of contract related to a failed Florid a real estate transaction. Randolph Equities was the only contract purchaser of the real estate involved in the underlying litigation. In February 2010, while the rent litigation was pending, Randolph Equities and the Sharifs settled the Black R ock litigati on for $3.3 million. Adam executed the settlement on behalf of Randolph Equities in his capacity as

1 In defendant Farouk Adam Sharif's briefs, he refers to himself as Adam. To avoid any confusion, we will do the same.1

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3 CEO. Although Randolph Equities was the only contract purchaser , non e of the Black R ock settlement proceeds were received by Randolph Equities

. The BlackRock settlement was disbursed in three parts : $975,000 to the Black R ock litigation attorneys in settlement of their f ees and $2,015,000 t o a Chicago law firm. The Chicago law firm then d istributed $1,351,000 to
Adam and $974,000 to Tierney

. Tierney never held any position with , or had any personal interest in , Randolph Equities . A ccording to the Black R ock settlement agreement, Tierney's share was in part payment of Adam's obligations under their marital settlement agreement and in part payment of her share of t he Black R ock settlement

. ¶ 6 The remaining $310,000 was distributed to Jacob Meister, a former in

- house counsel for Randolph Equities, p ursuant to a separate settlement agreement between Randolph Equities, the Sharifs and Meister, to release Meister's lien ag ainst the settlement and to establish a $50,000 escrow to satisfy certain specified Randolph Equities creditors, mostly law firms. Th is agreement also included a confidentiality provision instructing Meister on how to respond to any creditor inquiries r ega rding the Black R ock settlement and prohibiting Meister from disclosing the existence of the creditor escrow account. ¶ 7 Upon learning of the Black R ock settlement, plaintiff file d th e instant suit alleging that Randolph Equities was entitled to part or all of the Black R ock settlement because the Sharifs fraudulently transferred the settlement funds to themselves instead of Randolph Equities in contravention of the Act

. Plaintiff's complaint alleged two causes of action: imposition of a constructive trust over t he fraudulent transfer of the Black R ock settlement funds and unjust enrichment. ¶ 8 Adam was served with four requests to produce documents , which generated two motions1

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4 to compel discovery

. Plaintiff sought production of the Black R ock settlement information, any related accounting records and any documentation relating to funds Adam provided to Randolph Equities. Ultimately, Adam produced three documents: the Black R ock attorney fees settlement agreement , the marital settlement agreement and the Meiste r settlem ent agreement . Adam claimed that he did not have any documentation regarding funds he provided to Randolph Equities claiming that a ny such documentation was in the possession of his Chicago based

accountant and were available upon plaintiff 's request . Thos e documents were never produced. ¶ 9 A bench trial was held on May 9 , 2013. Plaintiff and Tierney filed a joint stipulation of facts that established that Tierney was never an officer or director of Randolph Equities ; she was a named plaintiff in and was paid from the Black R ock settlement ; and she did not personally invest funds in the failed Black R ock real estate transaction. V arious trial exhibits included the instant complaint, the Northwestern lease, letters of default sent on October 9 and November 4, 2009 , the Black R ock litigation complaint, the Black R ock lit igation settlement, a ban k statement from the Chicago

- based law firm that received the previously mentioned Black R ock proceeds , the settlement agreement s with the Black R ock attorneys and Meister , and t he $270,333.61 judgment order in favor of Northwestern

. ¶ 10 Adam, called as an adverse witness, was the only witness. Adam testified that Randolph Equities vacated the East Ontario Street offices in September 2008. He informed plaintiff at that time, but "[t]h ey would n ' t even accept the keys." H e was served with the rent litigation complaint in March or April 2010, after the Black R ock settlement in February 2010

. ¶ 11 Adam stated that when he authorized the Black R ock settlement disbursements in March
2010 , he was n ot aware of the rent litigation. Adam testified that o ver the course of a decade, he1

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5 gave Randolph Equities approximate ly $10 million for its operating expenses. Adam amassed these funds while working as the managing director of GMAC Commercial Mortgage, w here , for several years , he earned a " seven figure " income

. Adam maintained that these funds were loans

to Randolph Equities and Randolph Equities was indebted to him for these monies

. T hese loans

were t he only source of funds for the corporation. W hen Ada m ran out of money, Randolph Equities became insolvent

. His portion of the Black R ock settlement was partial re payment for those loans. He believed that Randolph Equities was free to choose which creditors to pay, so he paid himself first

. Adam did not prod uce any documentation to support his testimony that the $10 million was a loan . He maintained that his financial records were available for plaintiff 's inspect ion at his accountant's office in Chicago. ¶ 12 Adam signed the Black R ock settlement in his capacity as C E O of Randolph Equities. Randolph Equities was " the named purchaser " for the Florida real estate and the borrower for the lo ans at issue in the Black R ock litigation

. ¶ 13 After considering all the evidence, the trial court entered judgment in plaintiff's f avor on its claim for imposition of a constructive trust over the Black R ock settlement funds and found the count for unjust enrichment moot. The trial court observed that an intent to defraud can be proven by circumstantial evidence and generally reference d nine factors listed in the Act that may be considered. 740 ILCS 160/5(b) (West 20 08 ) . The court found that seven of the nine factors were satisfied such that a presumption of fraud was established . The trial court found that it did not believe Adam's tes timony that he "loaned" Randolph Equities $10 million or that he was a preferred creditor especially where there was no "corroborating document, evidence of any sort, a note, anything, or even a letter memorializing" the loans. T he trial court found that1

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6 A dam's testimony did not rebut the presumption of fraud. Specifically, the trial court stated :

" T here's been clear and convincing evidence presented here and it has not been rebutted that *** Randolph was methodically and intentionally and carefully put on the sidelines here by making sure that the name of the entity didn't appear on any check *** and only appeared when necessary to sign releases and release the flow of money to the other people *** that the presumption of fraud here has not been overcome j ust by the general claim that these were loan [s] ." Adam timely filed this appeal. D efendant Tierney did not appeal

. ¶ 14 ANALYSIS ¶ 15 Adam argues that the trial court did not properly apply the Act in this case and that the trial court's judgment wa s not based on the evidence. Defendant argues that interpretation of the
Act is at issue , which requires a de novo review. We disagree. The resolution of this appeal requires an evaluation of the evidence as it is applied to the Act

. T his factual determina tion calls for review under the manifest weight of the evidence standard. In re Application of the Kane County Collector , 297 Ill. App. 3d 745, 748 (1998). ¶ 16 The Uniform Fraudulent Transfer Act was enacted to enable a creditor to defeat a debtor's transfer o f assets to which the creditor was entitled. 740 ILCS 160/5 (West 20 08 ); s ee Rush University Medical Center v. Sessions , 2012 IL 112906, ¶ 20. T he purpose of the Act is to "invalidate otherwise sanctioned transactions made with a fraudulent intent

. " In re Marriage of Del Giudice , 287 Ill. App. 3d 215, 218 (1997). The Act supplements common law principles of "law and equity, including the law merchant and the law relating to principal and agent, estoppel, laches, fraud, misrepresentation, duress, coercion, m istake, insolvency, or other validating or1

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7 invalidating cause." 740 ILCS 160/11 (West 20 08 ); Rush University Medical Center , 2012 IL 112906, ¶ 18. ¶ 17 Under the Act , a transfer is fraudulent as to a creditor if the debtor made the transfer: "(1) with actual intent to hinder, delay, or defraud any creditor of the debtor; or (2) without receiving a reasonably equivalent value in exchange for the transfer or obligation, and the debtor: (A) was engage d or was about to engage in a business or a transaction for which the remaining assets of the debtor were unreasonably small in relation to the business or transaction; or (B) intended to incur, or believed or reasonably should have believed that he would incur, debts beyond his ability to pay as they be came due. " 740 ILCS 160/5(a) (West 20 08 ). A creditor is a person or entity who has a right to repayment, whether or not it has been redu ced to judgment. 740 ILCS 160/2 (c), (d) (West 20 08 ). The test to determine whether a transfer is valid under the Act is whether the transfer "directly tended to or did impair the rights of creditors." (Internal quotation marks omitted.) Apollo Real Estate Investment Fund, IV, L.P. v. Gelber , 403 Ill. App. 3d 179, 193 ( 2010). Under the Act , " [a] donor may make a conveyance with the most upright intentions, and yet, if the transfer hinders, delays, or defrauds his creditors, it may be set aside as fraudulent. " (Internal quotation marks omitted.) Id . at 193

- 94. ¶ 18 Illinois recognizes two categories of fraudulent transfers : "fraud in law" and "fraud in fact" which are distinguished by "whether the transfer was supported by consideration." Reagan v. Baird , 140 Ill. App. 3d 58, 64

- 65 (1985). A "fraud in law" transfer is w here a transfer is "made1

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8 for no or inadequate consideration ," the "fraud is presumed " ( Anderson v. Ferris , 128 Ill. App. 3d 149, 153 (1984)) and the intent of the parties to the transaction is immaterial ( Gary

- Wheaton Bank v. Meyer , 130 Ill. App. 3d 87, 94 (198 4 )). Conversely, where "actual consideration has been given for the transfer and a specific intent to d efraud" has been prove n , the transfer constitutes "fraud in fact." Anderson , 128 Ill. App. 3d at 153

. Here , Tierney stipulated she had no investment in Black R ock and no interest in R andolph Equities and the trial court s tated that it did

not find Adam's uncorroborated testimony that he loaned monies to R andolph Equities credible and found that the Black R ock settlement transfer s to the defendants were presumed fraudulent and the presumption of fraud was not rebutted

. ¶ 19 Adam first argues that the trial court " bypassed " a " fraud in law " analysis and " moved directly " to a " fraud in fact " analysis , suggesting that the trial court was obligated to consider both types of claims. Plaintiff brought a claim seeking imposition of a con structive trust over a fraudulent transfer under both "fraud in law" and "fraud in fact" theories. Contrary to defendant's argument, t he trial court was not required to conduct a " fraud in law " analysis before it analyzed the claim under a " fraud in fact " analysis. See First Sec urity Bank of Glendale Heights v. Bawoll , 120 Ill. App. 3d 787, 792

- 93 (1983) (when a transfer constitutes "fraud in law," the court need not consider in the alternative whether the transfer constitutes "fraud in fact"). Therefore, b ecause the trial court found a presumption of fraud based on the circumstances surrounding a debtor's substantial asset transfer that directly impaired the rights of a creditor, the trial court was not required to declare whether the transfer was "fraud in fact" or "fraud in law." ¶ 20 Second, Adam argues that the circuit court misapplied section 5 of the Act (740 ILCS 160/5 (West 20 08 ) when it failed to consider all 11 factors indicating fraud when finding a1

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9 presumption of fraud under "fraud in fact" analysis. As a threshold matter, Adam's brief on this issue fails to comply with the requirements set forth by Illinois Supreme Court Ru le 341(h)(7) (eff. July 1, 2008) . Rule 341 governs the procedure concerning appellate briefs. Supreme court rules are not suggest ions, but rather, they are mandatory and must be followed. Voris v. Voris , 2011 IL App (1st) 103814, ¶ 8; Niewold v. Fry , 306 Ill. App. 3d 735, 737 (1999). It is well established that " [r]eviewing courts are entitled to have the issues clearly defined, to be cited pertinent authorities and are not a depository in which an appellant is to dump *** argument and research as it were, upon the court " ( In re E state of Kunz , 7 Ill. App. 3d. 760, 763 (1972) ) and failure to cite to authority may result in forfeiture of the issue on appeal. Soter v. Christoforacos , 53 Ill. App. 2d 133, 137 (1964)

. ¶ 21 Adam does not provide any support for his argument that the circuit court is required to consider all 11 factors of fraud before it can determine intent to defraud. However , " waiver is an admonition to the parties, not a limitation upon the powers of [ the ] courts of review. " Mat t hews v. Chicago Transit Authority , 2014 IL App (1st) 123348 , ¶ 80 . We have the discretion to review the merits of Adam's first argument in the inter est of judicial economy and where, as here, the necessary facts to understand Adam’s argument are simple. Zadrozny v. City Colleges of Chicago , 220 Ill. App. 3d 290, 292

- 93 (1991). On this basis, we exercise our authority to review this appeal. ¶ 22 To prevail on a claim for " fraud in fact, " a plaintiff " must prove that the transfers were made with the actual intent to hinder, delay, or defraud the creditors. " Apollo Real Estate Investment Fund, IV, L.P. , 403 Ill. App. 3d at 193

. T he Act lists 11 factors which may be considered in determining fraudulent intent

. Section 5 (b) of the Act provides :1

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10 "in determining actual intent under paragraph (1) of subsection (a ) [actual intent to hinder, delay, or defraud any creditor of the debtor], consideration may be given, among other factors , to whether : (1) the transfer or obligation was to an insider; (2) the debtor retained possession or control of the property transferred after the transfer; (3) the transfer or obligation was disclosed or concealed; (4) before the transfer was made or obligation was incurred, the debtor had been sued or threatened with suit; (5) the transfer was of substantially all the debtor's assets; (6) the debtor absconded; (7) the debtor removed or concealed assets; (8) the value of t he consideration received by the debtor was reasonably equivalent to the value of the asset transferred or the amount of the obligation incurred; (9) the debtor was insolvent or became insolvent shortly after the transfer was made or the obligation was incurred; (10) the transfer occurred shortly before or shortly after a substantial debt was incurred ; and (11) the debtor transferred the essential assets of the business to a lienor who transferred the assets to an insider of the debtor." (Emphasis ad ded.) 740 ILCS 16 0 /5 (West 20 08 ). ¶ 23 Clearly, the Act does not require the trier of fact to consider all 11 factors . Rather, the statute provides that "[i]n determining actual intent *** consideration may be given, among other factors " (emphasis added). Id

. T he plain meaning of the Act does not require a court to consider1

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11 all 11 factors

. 740 ILCS 160/5(b) (West 2008) ; Falcon v. Thomas , 258 Ill. App. 3d 900, 911 (1994) (the 11 factors of fraud " may be considered in determining the debtor's actual intent" (empha sis added ) ) ; see Steel Co. v. Morgan Marshall Indus tries , Inc. , 278 Ill. App. 3d 241, 251 (1996) (interpreting the factors of fraud as mere considerations); In re Schneider , 417 B.R. 907, 915 ( Bankr. N.D. Ill. 2009) (referring to factors of fraud as " ' sym ptoms of fraud ' " that may be considered)

. Illinois law is clear that when the factors of fraud " are present in sufficient number, it may give rise to an inference or presumption of fraud. " Steel Co. , 278 Ill. App. 3d at 251 ( finding of four factors was su fficient to establish presumption of fraud); s ee Apollo Real Estate Investment Fund , IV, L.P. , 403 Ill. App. 3d at 193 ( finding of six factors was sufficient to establish presumption of fraud); Brandon v. Anesthesia & Pain Management Associates. , Ltd. , 419 F.3d 594, 600 (2005) (reversing trial court’s holding that five factors was insufficient to establish a presumption of fraud and suggesting that even a finding of one factor may be sufficient). In this case, the trial court considered nine factors of frau d and ultimately determined that seven factors weighed in favor of a presumption of fraud. W e find the trial court did not err in considering only 9 of the 11 factors of fraud in determining whether Adam acted with intent to hinder, delay, or defraud North western. ¶ 24 Third , Adam argues that the trial court's finding of a presumption of fraud was against the manifest weight of the evidence

. Adam argues that the trial court erred in finding a presumption of fraud because it failed to give sufficient weight to h is "uncontroverted" evidence that: (1) he did not receive notice of the back

- rent lawsuit until April or May of 2010, after the Black R ock settlement had been dispersed; and (2) he previously loaned Randolph Equities $10 million and

was entitled to a prefer ential re payment

.1

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12 ¶ 25 The standard of review of a trial court's judgment after a bench trial is whether that judgment is against the manifest weight of the evidence. Dargis v. Paradise Park, Inc. , 354 Ill. App. 3d 171, 177 (2004). A judgment is against the ma nifest weight of the evidence when it appears from the record that the judgment is arbitrary, unreasonable, not based on evidence, or the opposite conclusion is apparent

. Munson v. Rinke , 395 Ill. App. 3d 789, 795 (2009). We will not disturb a trial court' s judgment as long as there is evidence to support the judgment. Wilmette Partners v. Hamel , 230 Ill. App. 3d 248, 256 (1992). " [ W ] e may affirm the judgment of the trial court on any basis in the record, regardless of whether the trial court relied upon th at basis or whether the trial court's reasoning was correct." Alpha School Bus Co. v. Wagner , 391 Ill. App. 3d 722, 734 (2009). ¶ 26 Adam asserts that the trial court's finding of a presumption of fraud was "directly contradicted by the only evidence in the rec ord," and in support cites exclusively to his own testimony. Adam largely argues "facts" that he believes the trial court failed to weigh in his favor

or accept as true. A dam completely ignores the well

- established legal principal that the trier of fact, i n this case an experienced trial judge, is free to accept or reject testimony and give whatever weight it deems appropriate to the evidence sub mitted. Under a manifest weight of the evidence review, we give the trial court 's decision great deference becaus e " [ t ] he trial court is in a far better position to determine the credibility of witnesses." First Security Bank of Glendale Heights v. Bawoll , 120 Ill. App. 3d 787, 794 (1983) ; Falcon v. Thomas , 258 Ill. App. 3d 900, 909 (1994). A re viewing court will not substitute its judgment for that of the fact finder "on matters of credibility of a witness, weight of evidence and the inferences drawn from the evidence" unless the opposite conclusion is evident from the record. 1472 N. Milwaukee, Ltd. v. Feinerman ,1

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13 2013 IL App (1st) 121191, ¶ 21. ¶ 27 After considering all the evidence , including Adam 's testimony, the trial court determined that seven factors of fraud evidenced Adam's intent to defraud plaintiff . The court found , with more than ample justification, there was a presumption of fraud because Adam was on notice of the debt Randolph Equities owed to plaintiff and the subsequent transfer of the settlement funds to himself and his ex

- wife to the total exclusion of Randolph Equities , the only contract purchaser of the Florida real estate involved in the Black R ock litigation

. We affirm , finding that the trial court's judgment was not against the manifest weight of the evidence. ¶ 28 Adam contend s that he only b ecame aware of plaintiff's back

- rent law suit sometime in March or April of 2010, after the Black R ock settlement agreement. Adam asserts that he could not have had intent to defraud if he never had notice of a debt to Northwestern

. The trial court rejected Adam 's assertions and determined that Ad am , as president, CEO, COO and sole
manager , had notice of the back

- rent suit, or at least notice of a threat of suit , prior to the Black R ock settlement . The lease, executed by Adam on behalf of Randolph Equities, called for notice to be sent to Adam. C ert ified demand lette rs were sent to Adam , Randolph Equities' Chicago attorneys and its registered agent several months before the Black R ock settlement

. The trial court "accepted Mr. Sharif's contention that he didn't get a copy of the summons or complaint un til March [201 0 ]" but found that the two certified letters "indicate that he had to have

– understood or received notice that this was a debt" and there was " ample notice that this lawsuit was coming. You don't walk away from a commercial lease for numbers o f $200,000 without someone making an attempt to collect. And there's two letters that went to him , plus a lawsuit."1

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14 ¶ 29 U nder the Act , a creditor must show that it has a " 'right to payment' that it can seek to recover from the debtor

. *** [W]hether or not th e right is reduced to judgment." Apollo Real Estate Investment Fund, IV, L.P. , 403 Ill. App. 3d at 186

- 87 ; 740 ILCS 160/2 (c) (West 20 08 )

. Given Adam's self

- proclaimed success in the complex field of mortgage financing and his status

as manager, CEO, COO an d president of the debtor, there is no plausible argument that the trial

court was in correct. Therefore , we find that the trial court did not err in finding that plaintiff had a right to payment of the unpaid rent and Adam was on notice of this claim prior to the Black R ock settlement payout

. ¶ 30 Adam argues that the trial court " fail [ed] to address the fact that Adam is a creditor of Randolph Equities" and h e established through his testimony that he loaned Randolph Equities $10 million and , therefore, there w as adequate consideration for the transfer of the Black R ock settlement proceeds to himself, negating any presumption of fraud. He maintains the corporation was free to favor h im as a creditor over plaintiff

. Adam asserts that plaintiff did not controvert h is testimony and therefore, it must be taken as true. ¶ 31 In determining the validity of a transfer under the Act , the test is whether the transfer "directly tended to or did impair the rights of [ the ] creditors." (Internal quotation marks omitted.) Apollo Re al Estate Investment Fund, IV, L.P. , 403 Ill. App. 3d 179, 193

- 94 (2010) . "A donor may make a conveyance with the most upright intentions , and yet, if the transfer hinders, delays, or defrauds his creditors, it may be set aside as fraudulent." (Internal qu otation marks omitted.) Id . The burden of dispelling an implication of fraud for the transfer is on the debtor and the donee of the transfer. Harris v. Aimco , 66 Ill. App. 3d 60, 63 (1978)

. It is a correct statement that a debtor may prefer one creditor ov er another as long as he acts without fraudulent intent . " A1

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15 debtor has a right to prefer one creditor when he acts without fraud, even though he devotes all his property to the preferred creditor, leaving nothing to which his other creditors can resort.
Th ere must be evidence to show a fraudulent intent before a conveyance made upon a valuable consideration may be held fraudulent." Snow v. Hogan , 312 Ill. App. 636, 644 (1942) ; Zwick v.
Catavenis , 331 Ill. 240, 247 (1928); Harris v. Aimco , Inc. , 66 Ill. App. 3d 60, 63 (1978)

. In the instant case, the weight of the evidence supports the trial court's finding that routing the Black R ock settlement proceeds directly to Adam and his ex

- wife and not to Randolph Equities, the plaintiff/contract purchaser of the fail ed real estate transaction underlying the Black R ock
l itigation , was fraudulent. The parties agree that Adam was an insider of Randolph Equities due to his status as its manager, CEO , COO and president and that Randolph Equities was insolvent before the set tlement and at the time the bulk of the proceeds were transfe r r ed directly to Adam instead of Randolph Equities . Even if there had been credible evidence of consideration for the transfer , which the trial court totally dismissed, and Adam had been an actua l creditor of Randolph Equities, because the t ransfer s to Adam and Tierney effectively depleted all assets of the insolvent debtor, the transfer s were fraudulent because they hindered the rights of the plaintiff to collect the debt owed. Id

. ¶ 32 Contrary to A dam's argument, the trial court did consider Adam's testimony that he "loaned" Randolph Equities its operating capital. This testimony was considered and rejected. Adam testified that he loaned Randolph Equities $10 million o ver the course of 10 years and, therefore , adequate consideration existed for the transfer of the Black R ock funds to himself

. Adam had the burden to prove the transfer was not fraudulent in light of the substantial evidence that Randolph Equities was insolvent and stopped paying its re nt, he was the manager , president ,1

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16 CEO and C O O of the debtor, he had been sent a demand notice from plaintiff, he authorized the Black R ock settlement funds to be paid directly to himself and his former wife effectively eliminating any paper trail showing m oney going directly to Randolph Equities, a named plaintiff in the Black R ock litigation. According to Adam, he amassed his fortune working as the managing director of a commercial mortgage company and served on that company's senior management committee. H e founded Randolph Equities, an investment firm, and allegedly loaned the firm $10 m illion of his personal funds , and repaid himself part of the loan in preference over Randolph Equities' other creditors. His testimony alone did not carry the day. ¶ 33 Admittin g that his business records were with his accountant in Chicago, Adam failed to present objective, unbiased testimonial or documentary evidence , e.g . , cancelled checks, bank transfers, loan agreements, to support the position that the se transfer s to himsel f were credible loan repayments to a bona fide creditor. A fair review of the record establishes that Adam was a
R andolph Equities insider who transferred substantially all of its valuable assets, the Black R ock settlement funds, from R andolph Equities to h imself , in a manner designed to conceal the asset s from a known creditor at a time when he knew of the threatened suit and under circumstances he knew would render the debtor insolvent

. ¶ 34 The record reveals that plaintiff requested production of any docum e nts evidencing that the $10 million given to Randolph Equities was in fact a loan

. Tellingly, Adam did not produce these documents. Instead, Adam told the plaintiff it could inspect his files at his accountant's Chicago office. However, because the documen ts were allegedly in the possession of Adam's accountant, Adam had constructive possession of these documents and had the authority and ability to produce them as evidence in his defense. See Franzen v. Dunbar Builders Corp ., 1321

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17 Ill. App. 2d 701, 709 (197 1); Hawkins v. Wiggins , 92 Ill. App. 3d 278, 282 (1980). Because the

court correctly found that " there's really no documentary evidence there whatsoever to corroborate that [Adam loaned Randolph Equities $10 million] , " the trial court found that Adam’s tes timony failed to establish consideration for the transfer of Randolph Equities ' assets to himself, causing Randolph Equities to be come insolvent and unable to satisfy Northwestern's claim . A presumption of fraud was clearly established and clearly not rebu tted. ¶ 35 Where the trial court finds a presumption of fraud has been established , "the burden of dispelling the presumption of fraud and showing that actual consideration was given for the transaction is upon the debtor or the person to whom the property was conveyed." Harris , 66 Ill. App. 3d at 6 2

. Here the circuit court also explained that "[r]eally, Randolph [Equities] got nothing" although it was named on all the relevant documents at issue in the Black R ock litigation and Adam could not "throw" the corpor ation’s name "loosely on documents and then decide which way you want to go; when something bad happens, you put on the LLC, and when something good happens, you take it yourself. That’s not the way it works." The trial court correctly concluded that there was no credible evidence presented by Adam that he had a valid claim to the debtor ' s assets when he orchestrated the disbursement of the settlement to effectively conceal assets of the debtor from a creditor with a valid claim to those assets. As a review ing court, we do not substitute our judgment for that of the circuit court because it was in a better position to observe Adam’s testimony and assess his credibility. Falcon , 258 Ill. App. 3d at 909. ¶ 36 Therefore, we find that the evidence clearly support s t he judgment of the trial court that Adam fraudulently transferred proceeds of the Black R ock settlement in contravention of the Act

. We also find the trial court properly applied the Act and the trial court's judgment was not1

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18 against the manifest weight of the evidence. ¶ 37 CONCLUSION ¶ 38 For the foregoing reasons, we affirm the judgment of the circuit court of Cook County. ¶ 39 Affirmed

.