Court Opinion

ID: 3152605
Source: CourtListenerOpinion
Date Created: 2015-11-06 00:02:31.593993+00
Date Added: 2024-06-11T11:58:36.962010
License: Public Domain

Filed 11/5/15 Colonial Pacific Leasing Corp. v. Kazi CA2/8
                  NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.

              IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                     SECOND APPELLATE DISTRICT

                                                 DIVISION EIGHT

COLONIAL PACIFIC LEASING                                                B257599
CORPORATION, etc., et al.,
                                                                        (Los Angeles County
         Plaintiffs and Respondents,                                    Super. Ct. No. BC483162)
                v.

FATIMA KAZI,

         Defendant and Appellant.

         APPEAL from a judgment of the Superior Court of Los Angeles County.
William F. Fahey, Judge. Reversed and remanded with directions.

      Gareeb Law Group, Alexander S. Gareeb and Fadi K. Rasheed; Richard A.
Kraslow and Richard A. Kraslow for Defendant and Appellant.

         Reed Smith, Farah Tabibkhoei and Alexander Terras, for Plaintiffs and
Respondents.

                                       __________________________
       Colonial Pacific Leasing Corporation and GE Capital Commercial, Inc.
(collectively, GE) brought the instant fraudulent conveyance action to set aside a transfer
from its debtor Khatija Kazi (mother) to the debtor’s daughter Fatima Kazi (daughter).
GE was successful at trial and obtained a judgment against daughter setting aside the
transfer. While daughter’s appeal was pending, mother satisfied her underlying debt. As
the debt has been satisfied, GE is no longer a creditor of mother and the matter is moot.
We therefore reverse the judgment and remand with directions that the action be
dismissed.

                  FACTUAL AND PROCEDURAL BACKGROUND

       The relevant history is simple and undisputed. In November 2010, GE brought
suit against mother, obtaining a judgment against her in the amount of $9.9 million.
While that action was pending, mother transferred her mansion to daughter. It was this
transfer that GE sought to set aside as fraudulent. The operative complaint asserted a
single cause of action, for fraudulent transfer.
       On June 16, 2014, GE obtained a judgment declaring the transfer of the home
from mother to daughter null and void. Daughter filed a timely notice of appeal.
       While the appeal was pending, mother satisfied the underlying judgment. On
April 1, 2015, GE filed an acknowledgement of satisfaction of judgment. As such, GE is
no longer a creditor of mother, and has no interest in obtaining the house.1 GE sought to
dismiss the appeal as moot. We denied the motion on the basis that a dismissal would
leave standing the judgment voiding the transfer from mother to daughter, leaving
daughter with no basis to claim title to the property.

1      In its motion to dismiss the appeal as moot, GE argued that mother and daughter
“are free to restore the status quo ante with respect to the residential real estate that is the
subject of this action.”
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                                       DISCUSSION

        It cannot reasonably be disputed that the case is moot. Daughter herself argues
that a fraudulent transfer action is moot and must be dismissed if the plaintiff is no longer
a creditor of the debtor-transferor.2 (Allard v. DeLorean (9th Cir. 1989) 884 F.2d 464,
466.)
        The usual practice when a case becomes moot pending appeal is dismissal of the
appeal. (County of Fresno v. Shelton (1998) 66 Cal. App. 4th 996, 1005.) “But
involuntary dismissal of an appeal operates as an affirmance of the judgment below.
[Citations.] If the appellate court wishes to avoid this result (for example, when the trial
court granted relief that is rendered improper due to the mootness of the action), it can do
so by reversing the judgment solely for the purpose of restoring the matter to the
jurisdiction of the superior court with directions for that court to dismiss the action.
[Citations.] This approach disposes of the case, not merely the proceeding that brought it
to the appellate court. [Citation.]” (Ibid.) This resolution removes any implication that
the ‘less-than-fully litigated judgment’ has any continuing validity or effect. (Coalition
for a Sustainable Future in Yucaipa v. City of Yucaipa (2011) 198 Cal. App. 4th 939, 944.)
As there is no longer any basis for the judgment declaring the transfer null and void,
reversal and remand with directions to dismiss is the proper disposition of this matter.

2       However, daughter suggests that we should nonetheless resolve the appeal on the
merits. Specifically, daughter argues on appeal that the trial court erred in excluding
evidence that purportedly would have shown that mother’s debt to GE had been satisfied
at the time of trial. Daughter believes we should decide the issue of the relevance of her
evidence, as the issue will arise again in a currently pending action between mother and
GE for an accounting. While the issue of when GE was fully paid (and, therefore, if any
overpayments were made) may be of continuing interest in the accounting action, it is not
at issue in this case. This case consists of a single cause of action to set aside a fraudulent
transfer; the undisputed fact that GE has been fully paid mandates dismissal of the action.
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                                     DISPOSITION

       The judgment is reversed and the matter remanded to the trial court for dismissal
of the action as moot. The parties are to bear their own costs on appeal.

                                                 RUBIN, J.
WE CONCUR:

              BIGELOW, P. J.

              GRIMES, J.

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