IN THE COURT OF APPEALS OF TENNESSEE

AT KNOXVILLE

August 28, 2012 Session

KAREN STONER, EXECUTRIX OF THE ESTATE OF IRMA M. COLLINS v. 

BRITTANY C. AMBURN

Appeal from the Chancery Court for Jefferson County

No. 10-3-052 Telford E. Forgety, Jr., Chancellor

No. E2012-00075-COA-R3-CV - Filed September 28, 2012

Karen Stoner (“the Executrix”), in her capacity as the Executrix of the Estate of Irma M.

Collins, brought suit against Brittany C. Amburn seeking to divest ownership of certain real

property out of Amburn and into her name in her representative capacity. The suit was

grounded in the Executrix’s claim that the subject property was fraudulently conveyed to

Amburn by the latter’s stepfather, Larry C. Collins (“the Judgment Debtor”), a judgment

debtor of the Estate. The Executrix alleged that the transfer was made for the purpose of

shielding the property from execution on her judgment. At the conclusion of the proof in a

jury trial, the court held that no reasonable minds could reach a conclusion other than that the

conveyance was fraudulent in nature. The court directed a verdict in favor of the Executrix.

The court vested all right, title and interest to the property in the Executrix. Amburn appeals.

We affirm.

Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court

Affirmed; Case Remanded

CHARLES D. SUSANO, JR., J., delivered the opinion of the Court, in which HERSCHEL P.

FRANKS, P.J., and JOHN W. MCCLARTY, J., joined.

R. Deno Cole, Knoxville, Tennessee, for the appellant, Brittany C. Bradley, formerly

Amburn.

1

Ms. Amburn states that she married after this suit was filed and that her married name is “Bradley.” 1

For ease of reference, we shall continue to refer to her by her former name, “Amburn,” as reflected

throughout the record on appeal. 
Michael S. Kelley, Kathy D. Aslinger, Briton S. Collins, Knoxville, Tennessee, for the

appellee, Karen Stoner.

OPINION

I.

In June 2007, Irma Collins, the mother of both the Executrix and the Judgment

Debtor, filed a lawsuit against the Judgment Debtor in Ohio. She died on May 31, 2008.

2

The Executrix then prosecuted the Ohio lawsuit to its conclusion.

When he was sued in Ohio, the Judgment Debtor owned a condominium in Knox

County (“the Breckenridge property”). In February 2009, the Judgment Debtor offered the

Breckenridge property “for sale by owner” and reached an agreement to sell it to sisters, Sue

Wells and Patsy Meade (“the Buyers”), for $129,000. On February 12, 2009, the Judgment

Debtor conveyed the property to the Buyers by warranty deed, and the Buyers, after making

a down payment, executed a note and deed of trust to the Judgment Debtor for $114,000, the

remaining balance owed on the sale.

In March 2009, the Judgment Debtor gave his deposition in the Ohio lawsuit. On

September 24, 2009, the Ohio court entered a summary judgment against the Judgment

Debtor awarding the Executrix $789,276.99 plus statutory interest and costs (“the Ohio

judgment”).

On November 20, 2009, the Executrix filed suit in Tennessee to register and enforce

the Ohio judgment. Three days later, the complaint was served on the Judgment Debtor, who

was then living with his wife, Robin Collins (“Robin”), at a house he owned on Eden Lane

in Knoxville. Two weeks after that, on December 4, 2009, the property that is the subject of

the present case – a modular home and lot located in Knoxville at 2835 Daybreak Way (“the

Daybreak Way property”) – was purchased.

At trial, John Shelton, sales consultant for the seller, Clayton Homes, testified

regarding the sale. The Judgment Debtor along with Robin (collectively “the Collins”), and

Robin’s daughter, Amburn, were all present at the sale. According to Shelton, the Judgment

Debtor was involved “quite a bit.” All of the closing documents were completed solely in

Amburn’s name. Shelton testified that it was a cash deal and the Judgment Debtor carried

the money into the room in a cloth bank bag. Shelton recalled that the cash totaled around

The record does not reflect the basis of the suit. The gravamen of the complaint is not relevant to 2

the issues on this appeal. 

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$107,000, and mostly consisted of hundred dollar bills that were in bank wrappers separating

them into thousand dollar groupings. The closing documents included a buyer’s cash

disclosure form which reflected that the transaction was a “true cash” transaction – meaning

there was no outside financing source. “Brittany Amburn” was listed on the document as the

source of the cash payment. The deed titled the Daybreak Way property in Amburn’s name

alone. Shelton had no knowledge as to whom the cash belonged.

On February 8, 2010, the Executrix obtained a judgment from the Chancery Court for

Knox County registering the Ohio judgment in Tennessee (“the Tennessee judgment”). On

March 31, 2010, the Executrix filed suit in this case against Amburn. The suit essentially

sought to set aside the conveyance of the Daybreak Way property to Amburn on the ground

that it had been fraudulently conveyed to her by the Judgment Debtor. The suit also sought

to reform the deed to reflect the Executrix as the property’s lawful owner. In response,

Amburn denied the essential allegations of the complaint and demanded a jury trial.

In April 2011, the Executrix moved for summary judgment. In response to the

Executrix’s statement of undisputed facts, Amburn “categorically denied that [Judgment

Debtor] purchased the Daybreak Way property.” As support, Amburn submitted the

Judgment Debtor’s June 23, 2011, affidavit in which he denied using the money he obtained

from the sale of the Breckenridge property to purchase the Daybreak Way property.

Asserting that he contributed “very little” of his own cash, the Judgment Debtor stated in his

affidavit that the money to purchase the Daybreak Way property belonged to his wife, Robin,

and was mostly funds she received from her father’s estate and life insurance proceeds

following her father’s death in March 2008. The Judgment Debtor denied that he was

rendered insolvent by the Daybreak Way property transaction. He contended that he still had

most of the proceeds from the Breckenridge property sale. The Judgment Debtor further

denied the allegation that Amburn provided no consideration in the Daybreak Way property

purchase. He testified that Amburn turned over most of the $8,000 she received from the

government as a “first-time home-buyer [sic]” to Robin in exchange for her mother’s

assistance in purchasing the home. In summary, Amburn contended in her response to the

Executrix’s complaint that there were disputed facts “as to whether or not proceeds from [the

Judgment Debtor], . . . , were used to purchase real property titled in the name of [Amburn].”

The trial court denied the Executrix’s motion for summary judgment based on its

finding that “there are disputed material questions of fact that must be reconciled by a jury.”

To that end, the court ordered that the jury would be directed to report its verdict by

answering the following question: “Do you unanimously find, by a preponderance of the

evidence, that the December 4, 2009 purchase of 2835 Daybreak Way . . . was a fraudulent

transfer?”

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At the October 27, 2011, trial, the Executrix testified by videotape deposition from

Ohio, where she resides with her husband. The Executrix, 64, a retired deli clerk, explained

that she was unable to travel to Tennessee for trial because of multiple medical issues. She

noted that the Judgment Debtor is her only sibling. She stated they were close to each other

and to their mother growing up. In recent years, however, a feud had developed that the

Executrix said began in 2004 when the Judgment Debtor initiated a move of their elderly

mother from Ohio to Tennessee to live close to him. According to the Executrix, once their

mother was in Tennessee, the Judgment Debtor often left her alone for days at a time and

would not allow her to call the Executrix. In the Executrix’s opinion, the Judgment Debtor

attempted to isolate their mother from the rest of the family. In 2006, their mother spent the

Thanksgiving and Christmas holidays with the Executrix in Ohio. Soon after,she moved into

the Executrix’s Ohio home where she remained until her death.

The Executrix testified that she was determined to carry on the proceeding her mother

had initiated, including continuing her efforts to collect on the Tennessee judgment.

According to the Executrix, the Judgment Debtor had not worked in 20 to 30 years and his

only income sources of which she was aware were the VA disability benefits and social

security retirement benefits he received. She noted that the Judgment Debtor had once

briefly served in the Navy. She stated that he received disability benefits for “anger

management” issues.

Sue Wells testified regarding the Buyers’ purchase of the Breckenridge property.

Wells testified that, in the Fall of 2009, the Judgment Debtor offered to reduce their note by

$5,000 – to $124,000 – if the money was paid immediately, within 2 to 3 days, and in cash.

To complete the transaction, Wells obtained a loan and accompanied the Judgment Debtor

to her bank, where the Judgment Debtor received full payment in cash. Wells testified that

the Judgment Debtor “put it in his coat pocket and left.” Upon further questioning, Wells

stated she dealt solely with the Judgment Debtor throughout the transaction.

Amburn testified as the last witness. When the Daybreak Way property was

purchased, Amburn was eighteen and unemployed; before and since then, she has been

seasonally employed at the Knoxville Zoo and earned $7.25 an hour. She had briefly held

various other hourly-wage jobs. Amburn estimated she earned less than $10,000 in 2009.

Amburn admitted that the Judgment Debtor contributed “some” of the money used to

purchase the Daybreak Way property. She acknowledged that she had not contributed any

of the money. She said she had no personal knowledge as to how much the Judgment Debtor,

her mother, and/or anybody else actually contributed to the purchase. Amburn testified she

had not given the Judgment Debtor anything in exchange for the money he contributed, nor

had she agreed to make payments to him. Amburn stated that the “only exchange we had

over the house was that it was going to be a place that my mother could go and live . . . [in

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the event of] [the Judgment Debtor’s] death or a divorce or separation.” Initially, Amburn

disagreed that the house was actually intended for Robin rather than for her, saying that she,

Amburn, lived there and had been “homeless,” having slept in her car a few times before the

property was purchased. In later testimony, however, Amburn said that, at the time the

Daybreak Way property was purchased, she understood “that it wasn’t a house for [her] so

much as it was a house for [her] mother.” Amburn explained that, for this reason, when she

and the Judgment Debtor had disagreements, it was she, rather than the Judgment Debtor,

who left.

The trial court read Amburn’s October 2010 responses to interrogatories into the

record. In relevant part, Amburn was asked to state with particularity the source of all funds

used to purchase the Daybreak Way property. She answered that “[the Judgment Debtor] and

Robin . . . paid for 2835 Daybreak Way. . . .” Asked to state with particularity “[the

Judgment Debtor’s] involvement in the purchase,” Amburn again answered that “[the

Judgment Debtor] and Robin . . . paid for 2835 Daybreak Way.” Asked why the property

was paid for in cash, Amburn answered that “Daybreak Way was paid in cash by a

combination of cash from [the Judgment Debtor] and Robin . . . , a portion of which they

jointly shared.” Significantly, Amburn answered each question “[u]pon information and

belief.”

Just after the Daybreak Way property was purchased, Amburn and the Collins moved

into the house. At that time, the Collins vacated their Eden Lane home and allowed it to go

into foreclosure. Amburn testified that her mother told her that “they couldn’t afford the

payment and that it was too much house for [the Judgment Debtor] and her [at] their age.”

Amburn admitted that, in an earlier deposition,she instead testified that the Judgment Debtor

and Robin left the Eden Lane home in order to avoid making payments on it when there was

an outstanding judgment against them. Amburn testified that her only knowledge “of the

whole event” was what Robin said after suit was filed.

After purchasing the Daybreak Way property, the Collins furnished the entire home

and paid the utility bills. They moved into the master bedroom, while Amburn took another

bedroom. Amburn testified she moved out after a few months because she could not afford

to take care of the house and the utilities and because she, her mother and the Judgment

Debtor did not get along. On cross-examination, she conceded that, in her deposition, she

did not mention that she could not afford the bills as a reason she left, but had mentioned

only that she and the Judgment Debtor could not get along. She lived with a friend in

Knoxville until June 2010, returned to the Daybreak Way property until November, then

moved out again. According to Amburn, around the time of her departure, the Judgment

Debtor and Robin had also left the Daybreak Way property and began moving around,

staying at various motels, in order to avoid the Executrix’s lawsuit.

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In March 2011, Amburn, her then-fiancee and Robin, who had separated from the

Judgment Debtor, moved into the Daybreak Way property, where they remained at the time

of trial. Amburn agreed she never paid any utilities or other bills related to the Daybreak

Way property until she and her now-husband began living there in 2011. Amburn testified

she had never heard of the Executrix, the estate she represented, or the judgment she had

against the Judgment Debtor until the present lawsuit was filed. She said the Judgment

Debtor had not been back to the Daybreak Way property since he lived there just after its

purchase and it was not “his” house; she considered it hers. She denied ever having an

agreement to allow the Judgment Debtor to live there at his will.

At the close of the Executrix’s proof-in-chief, the Judgment Debtor moved for a

directed verdict. Following argument, the court found that “there is plenty enough evidence

. . on the [Executrix’s] side of the ledger” and denied the motion. After the Judgment Debtor

rested without calling any witnesses or offering other proof, the Executrix also moved for

a directed verdict. In opposing the motion, Amburn asserted, with little elaboration, that jury

questions remained about which reasonable minds could differ. Further, Amburn argued

that, through her own testimony, she had “explained away everything” with respect to any

indication of fraud presented by the Executrix’s proof.

The trial court declined to allow the case to go to the jury, and directed a verdict in

favor of the Executrix. In support of its ruling, the trial court found “that reasonable minds

could not differ as to the conclusions to be drawn from the evidence” – and that the only

reasonable conclusion wasthat the Judgment Debtor had fraudulently conveyed the Daybreak

Way property to Amburn. The court entered judgment in favor of the Executrix and ordered

that title to the property be divested out of Amburn and into the Executrix within 10 days

from the date of entry of its judgment. Amburn timely filed a notice of appeal.

II.

Amburn presents a single issue for our review:

Did the trial court err in granting a directed verdict in favor of

the Executrix?

III.

With respect to directed verdicts, our standard of review is as follows:

In ruling on such a motion, the standard applied by both the trial

court and the appellate court is the same as that applied to a

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motion for directed verdict made during trial. Therefore, the trial

court and appellate court are required to take the strongest

legitimate view of the evidence in favor of the opponent of the

motion, allow all reasonable inferences in his or her favor,

discard all countervailing evidence, and deny the motion when

there is any doubt as to the conclusions to be drawn from the

evidence. A verdict should not be directed during, or after, trial

except where a reasonable mind could draw but one conclusion.

Usher v. Charles Blalock & Sons, Inc., 339 S.W.3d 45, 57 (Tenn. Ct. App. 2010) (citing

Mercer v. Vanderbilt University, Inc., 134 S.W.3d 121, 130-31 (Tenn. 2004)(citations

omitted)).

A trial court’s decision to grant a motion for directed verdict is a question of law.

Underwood v. HCA Health Servs. of Tennessee, Inc., 892 S.W.2d 423, 425 (Tenn. Ct. App.

1994). This Court reviews questions of law de novo with no presumption that the trial court

decided them correctly. S. Constructors, Inc. v. Loudon Co. Bd. of Educ., 58 S.W.3d 706,

710 (Tenn. 2001); Green v. Moore, 101 S.W.3d 415, 418 (Tenn. 2003); Bowden v. Ward,

27 S.W.3d 913, 916 (Tenn. 2000).

IV.

A.

Amburn challenges the grant of directed verdict. She challenges the trial court’s

finding that the evidence reasonably leads only to the conclusion that the transfer of the

Daybreak Way property to her was fraudulent. Amburn contends that the court, in order to

find that no reasonable mind could reach any other conclusion, necessarily failed to take the

strongest legitimate view of the evidence in her favor. She argues that the court erred in

failing to construe the evidence in her favor and by failing to disregard all countervailing

evidence. Stated differently, Amburn contends that allowing the case to go to the jury “could

have resulted in the Court ruling that a fraudulent transfer did not occur.” The Executrix

responds that the trial court’s judgment is supported by undisputed evidence of both actual

and constructive fraud and should be affirmed.

As previously noted, the trial court granted the Executrix a directed verdict at the close

of the proof. It did so pursuant to Tenn. R. Civ. P. 50.01. The Rule provides as follows:

A motion for a directed verdict may be made at the close of the

evidence offered by an opposing party or at the close of the case.

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The court shall reserve ruling until all parties alleging fault

against any other party have presented their respective

proof-in-chief. A party who moves for a directed verdict at the

close of the evidence offered by an opponent may offer evidence

in the event that the motion is not granted, without having

reserved the right so to do and to the same extent as if the

motion had not been made. A motion for a directed verdict

which is not granted is not a waiver of trial by jury even though

all parties to the action have moved for directed verdicts. The

order of the court granting a motion for a directed verdict is

effective without any assent of the jury.

En route to its ruling, the court stated, in part:

THE COURT: I am . . . leaning toward a directed verdict. The

evidence here is undisputed. [The Judgment Debtor] got

$108,000.00 in cash. [The Judgment Debtor] took $107 -

whatever the purchase price on this property - - [the Judgment

Debtor] took it in himself. He was, if not the main moving force

in buying the house, he was involved - - I forget the witness’s

exact words, but involved to a great degree.

Then you have all these badges of fraud, which I’m telling you,

they are right here, every one of them, and there is no

explanation offered. [Amburn] just says, “Look, I don’t know,

I don’t know.” On top of that, you have [Amburn] in her own

deposition saying, look, mother and [the Judgment Debtor]

stopped paying on the Knoxville house and let it go into

foreclosure because they didn’t want to continue to pay the debts

and bills associated with it when they were going to get a big

judgment against them and just lose it.

* * *

Now, if you can tell me what other conclusion could a

reasonable mind draw, Mr. Cole? There is no question. There

is no question but that [the Judgment Debtor] contributed.

There is no question but that he contributed . . . to the purchase

of this property. And there is no evidence that anybody else did.

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[Mr. Cole, Counsel for Amburn]: Yes, there is, your Honor.

* * *

It is in the Interrogatories, [Amburn] stated that Robin Collins

contributed as well. That is in evidence.

THE COURT: Oh, I remember it.

* * *

State with particularity the source of all the funds used to

purchase 2835 Daybreak Way, . . . . Upon information and

belief, [the Judgment Debtor] and Robin Collins paid for 2835

Daybreak Way, which [Amburn] believes to total $109,000.00.

Explain why . . . Daybreak Way was purchased with cash. Upon

information and belief, Daybreak Way was paid in cash by a

combination of cash from [the Judgment Debtor] and Robin

Collins, of course, . . . which they jointly secured.

Mr. Cole, the motion is granted. The motion is good. The

badges of fraud, the Court’s opinion, no reasonable mind could

differ. I . . . thought about reserving judgment on the motion

and going ahead and submitting the matter to the jury, but, no,

the motion . . . is good upon the evidence here. There is just no

reasonable mind could reach any other conclusion. There is just

too much, just too much. . . .

In addition to its oral pronouncement, the trial court made additional pertinent findings

as follows:

The [Judgment Debtor] . . . used One Hundred Seven Thousand

Dollars ($107,000), in cash for the purchase of [the Daybreak

Way property].

[The Executrix] became a creditor of Judgment Debtor before

the purchase of . . . [the Daybreak Way property].

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Judgment Debtor did not receive from . . . [Amburn] anything

of an equivalent value in exchange for his purchase of . . . [the

Daybreak Way property].

Judgment Debtor was insolvent or rendered insolvent as a result

of the purchase of [the Daybreak Way property].

With respect to the nine (9) “badges of fraud” identified by the

Court in its previous findings, [Amburn] has not carried her

burden of providing proof of an explanation for these suspicious

circumstances.

B.

Our analysis of the trial court’s grant of a directed verdict begins with a review of the

statutory requirements for establishing a claim for a fraudulent conveyance. Tennessee’s

version of the applicable law – the Uniform Fraudulent Transfer Act – is codified at Tenn.

Code Ann. § 66-3-301, et seq. (2004) (“UFTA”). The Act delineates two types of fraudulent

transfers – the first applies to a debtor’s present and future creditors and involves actual

fraud, while the second applies only to present creditors and addresses constructive fraud.

See Tenn. Code Ann. §§ 66-3-305(a)(1), 66-3-306(a)(2004). Various remedies are available

to an affected creditor. See Tenn. Code Ann. § 66-3-308. Under the UFTA, a “transfer” is

3

defined, with respect to both statutes, as including “every mode, direct or indirect, absolute

or conditional, voluntary or involuntary, of disposing of or parting with an asset or an interest

in an asset, and includes payment of money, release, lease, and creation of a lien or other

encumbrance.” Tenn. Code Ann. § 66-3-302(12). In the instant case, there is no dispute that

a transfer took place with respect to the Daybreak Way property. Taking the statutes in turn,

we thus consider whether the transfer was fraudulent.

C.

In order to establish a claim of a fraudulent transfer pursuant to Section 66-3-

305(a)(1), it must be shown that the transfer was made with the “actual intent to hinder,

delay, or defraud any creditor of the debtor.” In making this determination, the courts are

guided by a consideration of the following factors, including whether

In its final judgment, the trial court stated that the parties in the present case agreed in a pre-trial

3

conference that divesting title of the Daybreak Way property out of Amburn and into the Executrix was the

proper remedy if a fraudulent transfer was established. 

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(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 the 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.

Tenn. Code Ann. § 66-3-305(b). The record reflects that the court considered the evidence

regarding each of the above-cited statutory factors and expressly found (with the exception

of factor eleven, which it held was inapplicable in the present case) the existence of every

factor tending to establish actual fraud on the Judgment Debtor’s part. We quote pertinent

portions of the court’s ruling elaborating as to certain factors:

Number 3: The transfer or obligation was disclosed or

concealed. The Court finds that the titling of the property in . . .

Amburn’s name was indeed an attempt to conceal the transfer.

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Number 5: The transfer was of substantially all the [D]ebtor’s

assets. The Court believes that factor is present here. Again[,]

the transferor here, [Judgment Debtor], had let a house in

Knoxville go into foreclosure and lose it specifically in an

attempt to try to avoid losing it toward payment of this

[judgment] debt which he already owed.

Number 6: The debtor absconded. That factor is present here.

[Judgment Debtor] wasn’t here at any time in this lawsuit . . . .

Number 7: The debtor removed or concealed assets. The court

finds that factor is present here. You get $109,000.00 in cash,

cash cash, on the sale of a house . . . there is nothing illegal

about that, but it is extremely unusual, and then you turn around

a short period of time later and you buy another house with cash

cash for $107,000.00 and title it in somebody else’s name, the

Court concludes that was an attempt to conceal the assets.

Number 8: The value of the consideration received by the debtor

was reasonably equivalent. Here [Judgment Debtor] didn’t

receive anything of value other than a promise, oral promise, not

included in the title papers . . . that . . . Robin . . . would have a

place to live.

The burden is on the plaintiff to prove that a particular transfer is fraudulent. The

finding of fraud is based upon the facts and circumstances of each case and is typically

proven by circumstantial evidence. Nadler v. Mountain Valley Chapel Bus. Trust, No.

E2003-00848-COA-R3-CV, 2004 WL 1488544, at *2 (Tenn. Ct. App. E.S., filed June 30,

2004) (citing Macon Bank & Trust Co. v. Holland, 715 S.W.2d 347, 349 (Tenn. Ct. App.

1986)). In addition to the above-cited statutory factors, circumstantial evidence may come

in the form of “badges of fraud” – circumstantial indicators used by the courts to perceive

a debtor’s intent for fraudulent transfer purposes. Badges of fraud have been described as

“any fact[s] that throw[] suspicion on the transaction and call[] for an explanation.” Macon

Bank, 715 S.W.2d at 349. Tennessee courts have identified the following badges of fraud:

1. The transferor is in a precarious financial condition.

2. The transferor knew there was or soon would be a large

money judgment rendered against the transferor.

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3. Inadequate consideration was given for the transfer.

4. Secrecy or haste existed in carrying out the transfer.

5. A family or friendship relationship existed between the

transferor and the transferee(s).

6. The transfer included all or substantially all of the transfer’s

nonexempt property.

7. The transferor retained a life estate or other interest in the

property transferred.

8. The transferor failed to produce available evidence explaining

or rebutting a suspicious transaction.

9. There is a lack of innocent purpose or use for the transfer.

Nadler, at *2 (citing In re Hicks, 176 B.R. 466, 470 (Bankr. W.D. Tenn. 1995)); Stone v.

Smile, E2009-00047-COA-R3-CV, 2009 WL 4893563, at *5 (Tenn. Ct. App. E.S., filed Dec.

18, 2009). “The presence of one or more of the badges of fraud gives rise to a presumption

of fraud and consequently shifts the burden of disproving fraud to the defendant.” Id. (citing

Macon Bank, 715 S.W.2d at 349).

Here, the trial court expressly found that all nine “badges of fraud” were present.

We agree. On our review, we conclude that the presence of the statutory factors set forth in

Section 66-3-305(b) as well as each of the common law badges of fraud amount to

overwhelming, circumstantial indicators of the Judgment Debtor’s “actual intent to hinder,

delay, or defraud” his creditors, the Executrix in particular. In considering the badges of

fraud, the trial court further observed, in relevant part:

The lack of an innocent purpose for the transfer. Another big

thing here, there is absolutely no explanation offered for any of

this, no explanation. [Amburn] - - And let me say this. I do not

mean to lay any of this at [Amburn’s] door. [. . . .]. There is no

evidence, no evidence, that she was culpable personally in any

way. I think this was a scheme of [the Judgment Debtor] and,

unfortunately, [Amburn] got caught up in it.

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And then, . . . : The transferor’s failure to offer evidence

explaining away the suspicious nature of the transfer. Again,

[the Judgment Debtor] is not even here, not been here at any

time in connection with this lawsuit.

Robin [ ] is not here. She has not been here at any time . . . .

She wasn’t here at the trial today.

There is absolutely no explanation offered here. [. . . .]. Too

many badges of fraud, too many facts. The fact that [the

Judgment Debtor] asked for the cash [from the Buyers of the

Breckenridge property], asked for it early, by the way, asked for

it early, got it early upon condition that it would be paid in cash.

And then shortly thereafter turned around and took a large sum

of money, $107,000.00, in a cloth bag, all but the last $2,000 of

it still bearing the bank bands, and paid for this house.

Just too many, . . . too many things to be explained away. You

just couldn’t . . . he just didn’t, he couldn’t explain them away.

Again, “[w]here the circumstances of a transfer of property by a debtor are suspicious,

the failure of the parties to testify or to produce available explanation or rebutting evidence

is a badge of fraud.” Union Bank v. Chaffin, 24 Tenn. App. 528, 147 S.W.2d 414 (1940).

In the instant case, proof of the existence of every applicable statutory factor and numerous

badges of fraud surround the transfer of the Daybreak Way property. The relevant facts thus

“threw the burden of going forward with proof of an explanation on the [Judgment Debtor].”

Macon Bank and Trust Co. v. Holland, 715 S.W.2d at 349. No such proof was

forthcoming. Accordingly, the evidence supports the conclusion that a fraudulent transfer

was conclusively shown. More significantly in the context of the Executrix’s motion for

directed verdict, we conclude that there were no evidence upon which a jury could base any

other conclusion.

D.

We next consider whether the transfer of the Daybreak Way property is properly

deemed fraudulent under Tenn. Code Ann. § 66-3-306(a). That Section provides as follows:

A transfer made or obligation incurred by a debtor is fraudulent

as to a creditor whose claim arose before the transfer was made

or the obligation was incurred if the debtor made the transfer or

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incurred the obligation without receiving a reasonably

equivalent value in exchange for the transfer or obligation and

the debtor was insolvent at that time or the debtor became

insolvent as a result of the transfer or obligation.

Thus, the elements required to establish a claim of a constructively fraudulent transfer are:

1) The creditor’s claim arose before the transfer;

2) The debtor did not receive a reasonably equivalent value; and

3) The debtor was insolvent or rendered insolvent by the

transfer.

Tenn. Code Ann. § 66-3-306(a); Stone v. Smile, 2009 WL 4893563 at *4.

As set out earlier in this opinion, the trial court expressly found that each element was

proven at trial. First, as Amburn concedes, there is no question that the first element exists;

the Executrix became a creditor of the Judgment Debtor before the Daybreak Way property

was purchased. The second element focuses on the value of the consideration the Judgment

Debtor received in exchange for the transfer. Amburn argues that there is a disputed issue

of fact “about the exact amount [the Judgment Debtor] contributed, if any,” to the purchase

of the Daybreak Way property. We disagree. At trial, Amburn admitted that the Judgment

Debtor had contributed “some” of the $107,000 plus purchase money. Further, the proof

showed that the purchase was made with cash that the Judgment Debtor supplied soon after

the Judgment Debtor received around $109,000 in cash from his sale of the Breckenridge

property. While Amburn stated in her interrogatory response, “upon information and belief”

– rather than personal knowledge – that the purchase was made by both the Judgment Debtor

and Robin, she produced no evidence at trial of any other source of the money other than the

Judgment Debtor. On the evidence before us, no disputed issue of fact exists as to whether

the money was contributed by the Judgment Debtor. All of it was contributed by him.

This leads us to consider whether the Judgment Debtor received anything of

“reasonably equivalent value” in return for the $107,000 plus he expended. Amburn insists

that the court failed to consider that the Judgment Debtor received “something” from

Amburn in exchange for the transfer – that is, the Judgment Debtor “received a promise that

[wife Robin] would receive a place to live” if the Judgment Debtor died or she and the

Judgment Debtor separated. To the contrary, the trial court found that the Judgment Debtor

received nothing of value from Amburn in exchange for the purchase and transfer of the

property other than “a promise, oral promise, not included in the title papers . . . that . . .

Robin . . . would have a place to live.” At trial, Amburn conceded that she contributed

nothing toward the purchase of the property, nor did she give the Judgment Debtor a deed

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of trust for the property, exchange anything of value, or promise him any payment in the

future. The UFTA expressly provides that “[v]alue is given for a transfer or an obligation

if, in exchange for the transfer or obligation, property is transferred or an antecedent debt is

secured orsatisfied, but value does not include an unperformed promise made otherwise than

in the ordinary course of the promisor's business to furnish support to the debtor or another

person.” Tenn. Code Ann. § 66-3-304(a) (emphasis added). Moreover, the official

comments to the same section make clear that value is to be determined from the perspective

of the creditor whereby it is stated that “[c]onsideration having no utility from a creditor’s

viewpoint does not satisfy the statutory definition.” Certainly, Amburn’s promise to allow

her mother to live in her home is of no value to the Executrix or any other of the Judgment

Debtor’s creditors.

Lastly, the trial court found that the Judgment Debtor was insolvent or rendered

insolvent by the purchase of the Daybreak Way property. Section 66-3-303(a) of the UFTA

provides that a “debtor is insolvent if the sum of the debtor’s debts is greater than all of the

debtor’s assets, at a fair valuation.” With entry of the judgment stemming from the Ohio

lawsuit, the Judgment Debtor was indebted to the Executrix alone for at least $789,276.99.

There was evidence showing that, from February 2009 through August 2011, the Judgment

Debtor never maintained a bank account balance over $10,000, and, many times, it was

considerably less. In fact, in several months, the records reflected a negative account balance

and the bank’s imposition of overdraft fees. The evidence showed that the Judgment Debtor

received income in the form of disability benefits that totaled some $4,000 a month; no other

evidence of any income source was presented. In addition, the Judgment Debtor had owned

two properties – Eden Lane and the Breckenridge property; the first was foreclosed upon and

the second sold. No other evidence of any assets of the Judgment Debtor was presented.

Amburn testified that the Judgment Debtor and Robin had allowed their Eden Lane home to

go into foreclosure and began moving from motel to motel in an effort to avoid payment of

the judgment. In short, Amburn’s contention that a jury may have reasonably concluded that

the Judgment Debtor owned assets other than those reflected in his bank account records is

most unpersuasive; such a finding would amount to nothing more than pure conjecture as

there was no basis for such a finding in the evidence. In our view, the evidence

overwhelmingly preponderatesin favor of the finding of a constructively-fraudulent transfer,

to the exclusion of any other conclusion.

V.

In summary, if, from all of the evidence, there is a reasonable basis for disagreement

among reasonable persons as to whether the Judgment Debtor fraudulently transferred the

property, then the question is one for the jury. Given the evidence before us, we conclude

that there is but one, inescapable conclusion to be drawn from the evidence at trial – the

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Judgment Debtor’s transfer of the Daybreak Way property to Amburn was fraudulent

pursuant to both Tenn. Code Ann. § 66-3-305(a) and § 66-3-306(a). Accordingly, the trial

court did not err in granting the Executrix a directed verdict.

VI.

The judgment of the trial court is affirmed. This case is remanded to the trial court,

pursuant to applicable law, for enforcement of the trial court’s judgment and for collection

of costs assessed below. Costs on appeal are taxed to the appellant, Brittany C. Bradley.

_______________________________

CHARLES D. SUSANO, JR., JUDGE

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