Court Opinion

ID: 9846438
Source: CourtListenerOpinion
Date Created: 2023-09-24 03:40:50.655348+00
Date Added: 2024-06-11T09:19:29.918410
License: Public Domain

Beasley, Presiding Judge,
dissenting.
I respectfully dissent. First of all, this is not a case about the sufficiency of the complaint. The majority’s references to OCGA § 9-11-9 (b) are not relevant to the issues. Continental Invest. Corp. v. Cherry, 124 Ga. App. 863 (186 SE2d 301) (1971); Leachman v. Cobb Dev. Co., 226 Ga. 103 (172 SE2d 688) (1970); and Collins v. Manley, 223 Ga. 816 (158 SE2d 235) (1967) all deal with the sufficiency of petitions or complaints alleging fraud. In this complex case there have been two jury trials based on a pretrial order, thousands of pages of record, and a reversal of the first judgment by the Supreme Court because the trial court had exceeded the bounds of discretion in limiting the parties in the development and presentation of the case. Newton Commonwealth Prop. v. G+H Montage GmbH, 261 Ga. 269 (404 SE2d 551) (1991). That the complaint adequately alleged the fraud is not contested at this stage.
More importantly, I am compelled to disagree with the majority’s holding that the circumstantial evidence in this case was not sufficient to authorize the jury to infer that Irvani conveyed the contested millions of dollars to the corporate defendants and that G+H’s failure to produce direct evidence that Irvani was the source of the funds by way of specific conveyances was fatal to its case.
There is evidence that the only individuals with any ownership interest in the corporate defendants were Irvani, his wife, and sons, and G+H has accurately summarized its evidence with respect to him as follows: Irvani had the means, motive and opportunity to have substantial assets outside Iran which gave him the ability to fund the *897corporate defendants. After he defaulted on his obligation to G+H in 1979, his business associate, Carlson, set up the first of a series of bearer share corporations for which the identity of the owner was concealed. Irvani then came to Georgia and began business operations and real estate acquisitions in the names of these and the other companies which ultimately became the corporate defendants. He personally participated in selecting the property and beginning the corporations, using the same managers and conducting the same kinds of businesses as he had conducted in Iran. He controlled the companies and their assets, and he rather than any other family member or anyone else made the business decisions about them. Employees and bankers were led to believe that the assets of the companies were owned by Irvani, and in forming the banking relationships on behalf of the companies he claimed a $300,000,000 net worth. He acknowledged in writing that he had transferred his own money into Georgia Industries, Inc. Yet, according to Irvani’s closing argument, his defense to G+H’s case was that he lost everything in the Iranian Revolution.
As acknowledged by the majority, G+H submitted evidence that $30,000,000 to $38,000,000 was transferred to the corporate defendants, which Irvani set up. Defendants claimed that most of the money was transferred to them by Irvani’s wife’s corporation, Savoy, and the rest by Irvani’s wife and sons. However, G+H’s accountant showed that all of these were excluded as sources. Moreover, defendants relied upon conflicting oral testimony rather than corporate records to explain their funding. “If a party has evidence in his power and within his reach by which he may repel a claim or charge against him but omits to produce it, or if he has more certain and satisfactory evidence in his power but relies on that which is of a weaker and inferior nature, a presumption arises that the charge or claim against him is well founded; but this presumption may be rebutted.” OCGA § 24-4-22.
There was no evidence presented by either G+H or the corporate defendants that anyone other than Irvani, his wife (individually or through Savoy), or his sons transferred the monies to the corporate defendants. G+H submitted evidence that Irvani’s wife and sons had no more than $18,000,000 in assets. It also showed that Irvani did have sufficient assets to fund the conveyances.
Thus, it was for the jury to say whether or not the circumstances preponderated to the theory that Irvani was the source of the transfers from unidentified “shareholders,” as shown on the corporate books, as against all other theories. Radcliffe v. Maddox, 45 Ga. App. 676, 682 (2) (165 SE 841) (1932). The jury was authorized to infer that, through whatever circuitous means, Irvani transferred at least $20,000,000 to the corporate defendants. See Cotton v. John W. Esh*898elman & Sons, 137 Ga. App. 360, 366 (4) (223 SE2d 757) (1976); cf. United States v. Jackson, 935 F2d 832, 839 (4) (7th Cir. 1991).
The majority’s conclusion that the evidence was not sufficient to support this inference rests on the fact that the record is devoid of any evidence that Irvani was the source of Savoy’s assets. While that is true, there is evidence that Irvani’s wife was the sole source of Savoy’s assets. Therefore, the jury was authorized to find that neither Irvani’s wife, nor his sons, nor Savoy, had more than $18,000,000. The majority decision necessarily rests on the hypothesis that the contested millions came from sources other than Irvani’s wife, or his sons, or Savoy, notwithstanding the fact that the corporate defendants claimed that the money came from precisely these sources. The majority is thus requiring that the proved circumstances show consistency with the hypothesis claimed by the winning side and inconsistency with a hypothesis contrary to the position taken by the losing side. This conflicts with the principle restated in Southern R. Co. v. Ga. Kraft Co., 258 Ga. 232, 233 (367 SE2d 539) (1988): “Where a decision is required between two or more antagonistic theories, an authorized finding that the evidence preponderates to one theory as against all the others necessarily carries with it a finding that the rejected theories are excluded. [Cit.]”
Was the trial court required to grant the corporate defendants’ motion for judgment n.o.v. because of G+H’s failure to submit direct evidence of specific conveyances of funds by Irvani? For several reasons, the answer to this question must be no.
Any fact may be proved by circumstantial evidence. Kapsch v. Stowers, 209 Ga. App. 767, 769 (1) (434 SE2d 539) (1993). Moreover, recourse to circumstantial evidence is a necessity since proof of fraud is seldom if ever possible by direct evidence. “ ‘ “[T]here is no kind of action wherein it can be held with greater reason that the fact in issue may be inferred from other facts proved than in cases of this character. Circumstances apparently trivial or almost inconclusive, if separately considered, may by their number and joint operation, especially when corroborated by moral coincidences, be sufficient to constitute conclusive proof.” ’ [Cit.]” Durrence v. Durrence, 224 Ga. 620, 623 (2) (163 SE2d 740) (1968).
The majority acknowledges circumstances in this case which are “badges of fraud,” from which the jury might have inferred that a particular conveyance, once identified, was fraudulent, but reasons that since G+H has not identified or offered proof of any specific conveyance by Irvani, the issue of fraud is not even reached. However, no state or foreign case is cited as authority in support of the holding that a claimant must specify the time of the transfer and describe the instrument by which the alleged fraudulent conveyance was accomplished.
*899Decided December 5, 1994
Reconsideration denied December 20, 1994
King & Spalding, L. Joseph Loveland, Jr., Frank C. Jones, Webb, Tanner & Powell, Anthony O. L. Powell, for Gwinnett Property.
Branch, Pike & Ganz, James H. Rollins, Cindy J. Davis, for Irvani.
Booth, Wade & Campbell, G. Dean Booth, L. Allison Wade, L. Dale Owens, for G+H Montage GmbH.
If a claimant must describe the instrument by which the alleged fraudulent conveyance was accomplished, as held by the majority, then debtors effectively put themselves beyond the reach of OCGA § 18-2-22, our statute on fraudulent conveyances, by transferring funds secretively, such as electronically through offshore bearer-share corporations, or by cash. This is directly contrary to OCGA § 18-2-22 (2), which states that “[e]very conveyance of real or personal estate, by writing or otherwise . . . made with intention to delay” shall be fraudulent in law against creditors. (Emphasis supplied.) In McGahee v. McGahee, 204 Ga. 91, 97 (2) (48 SE2d 675) (1948), the Court held that the statutory provisions on fraudulent conveyances are broad enough to include every transaction by which creditors or others may be defrauded regardless of nature or form. Moreover, in OCGA § 18-2-20, the General Assembly has provided that “[t]he rights of creditors shall be favored by the courts; and every remedy and facility shall be afforded them to detect, defeat, and annul any effort to defraud them of their just rights.” Consequently, the majority holding does not comport with Georgia law. It leaves creditors remediless in the face of various devices for surreptitious conveyances of money and denies the jury its proper factfinding role.
I am authorized to state that Chief Judge Pope and Judge Blackburn join in this dissent.