Court Opinion

ID: 6017612
Source: CourtListenerOpinion
Date Created: 2022-01-13 11:28:54.962847+00
Date Added: 2024-06-11T08:50:37.373564
License: Public Domain

Order and judgment (one paper), Supreme Court, New York County (Edward Lehner, J.), entered August 23, 1996, inter alia, declaring that the corporate respondent’s transfer of settlement proceeds to the individual respondent was fraudulent as against petitioner, and awarding petitioner the amount of such proceeds, unanimously affirmed, without costs.
The IAS Court correctly determined, without a hearing, that the insolvent corporation’s transfer to its director and sole shareholder was lacking in good faith (see, Julien J. Studley, Inc. v Lefrak, 66 AD2d 208, 213-214, affd 48 NY2d 954), and that since the latter was the only other creditor of the former, it would be inequitable, in voiding the transfer, to effect a pro rata distribution. That petitioner is not a secured or judgment creditor is irrelevant under a statute that extends protection against fraudulent transfers to debts not in existence at the time of the transfer (supra, at 214); moreover, respondents had induced petitioner’s forbearance from reducing its debt to judgment or restraining the disputed funds. We have considered respondents’ other contentions and find them to be without merit. Concur—Sullivan, J. P., Rosenberger, Ellerin and Nardelli, JJ.