-1-

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ILLINOIS 

EASTERN DIVISION

JAMES M. MCDONALD II, as Trustee and )

sole beneficiary of the WALTER MIDDLETON )

& COMPANY RETIREMENT PLAN and )

WALTER MIDDLETON & COMPANY ) 

FROZEN RETIREMENT PLAN )

Plaintiffs, ) No. 04 C 0334

)

v. ) Judge Manning

) Magistrate Judge Nolan

ESTATE OF JOSEPH W. GAYTON and )

MONICA M. GAYTON )

Defendants. )

MEMORANDUM AND ORDER

Plaintiff James M. Macdonald II, as Trustee and sole beneficiary of the Walter Middleton

& Company Retirement Plan and Walter Middleton & Company Frozen Retirement Plan

(“MacDonald”), alleges that Joseph Gayton (“Joseph”), fraudulently transferred property to

defendant Monica Gayton (“Monica”) in violation of the Illinois Uniform Fraudulent Transfer

Act, 740 ILCS 160/1 et seq. (“UFTA”). Monica seeks summary judgment pursuant to Federal

Rule of Civil Procedure 56. For the following reasons, the motion is granted. 

I. BACKGROUND

The facts of this case are not in dispute. MacDonald loaned Joseph $325,000 at some

point prior to February 2, 2001. At least seven years prior to February 2, 2001, Joseph and

Monica owned real estate located at 3524 Riverside Drive, Wilmette, Illinois (“Wilmette home”)

as joint tenants. On February 2, 2001, Joseph executed a quitclaim deed conveying his interest in

the Wilmette home to Monica. The parties agree that both Monica and Joseph, as well as the
-2-

attorney who prepared the quitclaim deed, were aware that Joseph was indebted to MacDonald

prior to preparation and execution of the quitclaim deed. Shortly thereafter, on March 15, 2001,

the February 2, 2001, conveyance was recorded with the Recorder of Deeds. 

On August 7, 2003, Macdonald filed suit against Joseph in the United States District

Court for the Northern District of Illinois, Eastern Division, Case No. 03 C 5483, alleging

breaches of certain notes. Joseph died on November 26, 2003. MacDonald did not perfect or

record a judgment lien against the Wilmette home prior to Joseph’s death. However, on

December 22, 2003, in case no. 03 C 5483, the court entered judgment nunc pro tunc as of

October 28, 2003, in favor of Macdonald and against Joseph in the amount of $357,139.89. 

MacDonald never obtained a judgment against Monica. 

MacDonald then filed the instant action seeking to avoid the transfer of the Wilmette

home to Monica under the Illinois Uniform Fraudulent Transfer Act so that he could then levy on

the Wilmette home to satisfy the judgment against Joseph. Monica has moved for summary

judgment.

II. SUMMARY JUDGMENT STANDARD

Summary judgment is proper when the “pleadings, depositions, answer to interrogatories,

and admissions on files, together with the affidavits, if any, show that there is no genuine issue of

any material fact.” Fed. R. Civ. P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). 

“The evidence of the non-movant is to be believed, and all justifiable inferences are to be drawn

in his favor.” Valenti v. Qualex, Inc., 970 F.2d 363, 365 (7th Cir. 1992). Further, a court should

grant summary judgment only when the record shows that a reasonable jury could not find for the

nonmoving party. Id.
-3-

III. ANALYSIS

Monica contends that even if the transfer was fraudulent under section 5 of the UFTA

(which she denies), MacDonald cannot obtain the relief he seeks. Specifically, Monica argues

that MacDonald could not have perfected a lien on the Wilmette home with respect to the

judgment against Joseph because he did not have an interest in the Wilmette home at the time

that MacDonald obtained the judgment against him. 

A judgment against an individual is not automatically deemed a lien against the judgment

debtor’s real property until the judgment creditor perfects a lien on the judgment debtor’s real

property pursuant to the method required by the Illinois Code of Civil Procedure. 735 ILCS

5/12-101. Section 5/12-101 of the Illinois Code of Civil Procedure requires a judgment debtor to

file the judgment in the office of the recorder of deeds in the county in which the real estate is

located. Casey National Bank v. Roan, 668 N.E.2d 608, 612 (Ill. App. Ct. 1996). Thus, in order

for MacDonald to perfect a lien on the Wilmette home, he must have recorded a judgment lien

against the Wilmette home during the period in which Joseph had an interest in the home.

Given that Joseph conveyed the Wilmette home to his wife on February 2, 2001, Joseph

had no interest in the property on the date of the October 28, 2003 judgment. Because a party

may only attach a lien as to property possessed by a judgment creditor at the time the judgment is

entered, MacDonald has no lien on the property as to Joseph. MacDonald v. Gayton, 04 C 334,

docket no. 13, (N.D. Ill. Sept. 17, 2004) (denying petitioner’s motion to intervene because “at the

time [petitioner] filed his lien against Mr. Gayton’s interest in the Wilmette home, Mrs. Gayton

was the sole owner of the property. This means that the lien is invalid under Illinois law since at

the time it came into existence, Mr. Gayton had no interest in the Wilmette property.”) (citations
1Moreover, MacDonald admitted in a response brief to an earlier motion to intervene that

Gayton ceased to have an interest in the Wilmette home after February 2, 2001. See Plaintiff’s

Response to Louis Kovanda’s Motion to Intervene and Removal filed August 5, 2004 (“Since

Joseph Gayton had no interest in the property located at 3524 Riverside Drive, Wilmette, Illinois,

after February 2, 2001, Kovanda’s judgment lien recorded on December 3, 2003 is not valid.”)

-4-

omitted).1

 Indeed, no lien can exist even if the alleged fraudulent transfer were set aside because

the transfer of the property as between Joseph and his wife is valid. DeMartini v. DeMartini, 52

N.E.2d 138, 140 (Ill. 1943) (“it is well established that a transfer of property fraudulent and void

as to creditors is nevertheless valid as between the parties thereto.”) (emphasis added). 

MacDonald acknowledges that he does not have a lien and states “[a]lthough the cases

may state that MacDonald does not have a lien at this point, they do not prohibit him from

pursuing the cause of action under the UFTA.” Resp. at 4. MacDonald argues that even if the

transfer is intact as between Monica and Joseph, the property can still be used to satisfy the

judgment against Joseph, assuming MacDonald can prove that the fraudulent transfer occurred. 

Specifically, MacDonald states that the UFTA “allows this Court to enter a judgment against the

‘first transferee’, in this case Defendant Monica Gayton. MacDonald would be allowed to

recover either the property itself or its cash value in satisfaction of the debt.” Resp. at 6

(citations omitted). 

Under the UFTA, “[e]xcept as otherwise provided in this Section, to the extent a transfer

is voidable in an action by a creditor under paragraph (1) of subsection (a) of Section 8, the

creditor may recover judgment for the value of the asset transferred, as adjusted under subsection

(c), or the amount necessary to satisfy the creditor’s claim, whichever is less.” 740 ILCS

160/9(b). Further, “the judgment may be entered against: (1) the first transferee of the asset or

the person for whose benefit the transfer was made.” 740 ILCS 160/9(b)(1). 
-5-

However, an Illinois court addressing a similar fraudulent transfer claim, has stated:

Moreover, apart from the dismissal [on statute of limitations grounds], the

Company’s [fraudulent transfer] claim is moot because the company alleges that

Nick, as a joint tenant, fraudulently transferred his interest to the other joint

tenant, his wife, and then he died. Assuming the Company was successful on the

merits of its claim for fraudulent transfer, the court would reinstate the property as

it was at the time prior to the fraudulent transfer. Because Nick’s death occurred

prior to any judgment received by the Company, the property would have

transferred to the surviving joint tenant at that time of death, extinguishing any

rights the Company may have had.

Gilbert Bros. v. Gilbert, 630 N.E.2d 189, 192-93 (Ill. App. Ct. 1994) (emphasis added).

MacDonald makes much of the fact that the judgment in his favor was entered nunc pro

tunc as of October 28, 2003 (i.e., prior to Joseph’s death). However, the fact that the judge

entered the judgment order nunc pro tunc did nothing to help MacDonald as he did not record the

lien prior to Joseph’s death. At the time of Joseph’s death, regardless of whether the prior

transfer was fraudulent or not, the property passed to Monica. MacDonald has not cited to any

authority for the proposition that a judgment order entered nunc pro tunc prior to a judgment

debtor’s death also somehow simultaneously creates a recorded lien nunc pro tunc. 

Because MacDonald cannot obtain relief under the UFTA, defendant’s motion for

summary judgment is granted. 

IV. CONCLUSION

For the reasons stated above, the court grants Monica’s motion for summary judgment

[33-1].

ENTER: __________________________________________

Blanche M. Manning

United States District Judge

DATE: August 30, 2005