Opinion ID: 660667
Heading Depth: 3
Heading Rank: 3

Heading: Travelers' Standing to Bring Fraudulent Conveyance Claims

Text: 57 It is undisputed that the Partnership was in possession of the Property at the time of Travelers' original complaint. Therefore, at the time of the filing of Travelers' original complaint, an action in equity for waste would have lain against the Partnership. As discussed above, the claims set forth in Travelers' amended complaint relate back to the original complaint. Because the partnership might have been enjoined from distributing cash reserves to the partners on the grounds that such a distribution would have prevented it from paying property taxes, the distribution injured Travelers. Therefore, Travelers has standing to challenge the distributions under New York fraudulent conveyance law insofar as Travelers' claims related to the portion of the distributions against which an equitable action for waste could have been brought. We reverse the District Court's order dismissing Travelers' claims of fraudulent conveyance insofar as they relate to the portion of the Partnership's cash assets against which Travelers could have brought an equitable action for waste. We affirm the District Court's order insofar as it dismisses Traveler's claims of fraudulent conveyance of assets against which Travelers could not have brought an action in equity for waste.