Court Opinion

ID: 4668976
Source: CourtListenerOpinion
Date Created: 2021-03-17 23:02:16.224987+00
Date Added: 2024-06-11T07:50:29.351403
License: Public Domain

Filed 3/17/21 Katoozian v. Chu CA1/3
                  NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or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

                                      FIRST APPELLATE DISTRICT

                                                DIVISION THREE

 MINA KATOOZIAN,
           Plaintiff and Respondent,
 v.                                                                      A156465
 DAVID CHU et al.,
           Defendants and Respondents;                                   (Alameda County
 LEANNA TRAN, as Trustee, etc.,                                          Super. Ct. No. RG06286726)

           Third Party Claimant and
           Appellant.

         This is the latest hurdle in a nearly 15-year effort by plaintiff Mina
Katoozian to recover for property damage she sustained as a result of poorly
done home construction performed by defendant David Chu and his company,
US Home Center. Katoozian obtained a $162,488.03 judgment against Chu
in 2009. However, due to Chu’s unlawful scheme to transfer his assets to a
family trust followed by his filing of a bankruptcy petition in federal court, it
was not until 2016 that Katoozian obtained a writ of execution against Chu
and an order was issued to levy upon his real property, commonly known as
4933 San Leandro Street, Oakland, California (hereinafter, Subject
Property).

                                                               1
      After the Subject Property was levied upon, third party claimant,
Leanna Tran, with whom Chu has two children, filed the instant third party
claim under Code of Civil Procedure section 720.1101 for exemption as alleged
trustee of the Dereconn Family Trust (hereinafter, Trust), asserting sole
ownership in the Subject Property. The trial court rejected Tran’s third party
claim, a ruling that Tran herein challenges on the grounds that: (1) the time
to execute on any judgment or to levy against the Subject Property has
expired; (2) the trial court failed to recognize her equitable interest in the
Subject Property; and (3) the trial court made erroneous factual findings,
including that she and Chu had been married, that the Subject Property was
their community property, and that Chu’s transfer of the Subject Property to
the Trust was fraudulent. We affirm.
             FACTUAL AND PROCEDURAL BACKGROUND
      On or about July 13, 2005, a grant deed was recorded in the Alameda
County Clerk-Recorder’s Office reflecting the transfer of the Subject Property
to “David Chu and Leanna Tran, husband and wife, as joint tenants.”
      On August 30, 2006, Katoozian filed a complaint in this matter against
Chu and his business, US Home Center, asserting causes of action for breach
of construction contract and negligence. This matter was referred to judicial
arbitration, and, on June 27, 2008, Katoozian was awarded “[r]estitution of
all funds paid Chu plus costs to restore and prepare property for future

      1 Under Code of Civil Procedure section 720.110, subdivision (a): “A
third person claiming ownership or the right to possession of property may
make a third-party claim under this chapter in any of the following cases if
the interest claimed is superior to the creditor’s lien on the property:
[¶] (a) Where real property has been levied upon under a writ of attachment
or a writ of execution.”

                                        2
remodeling/repair.” The arbitration award was not accepted, however, and
this matter returned to court for trial.
      On November 21, 2008, Tran sued Chu in Alameda County Superior
Court, case No. RG08421763, asserting causes of action for breach of
contract, declaratory relief, and imposition of an involuntary trust.
      Also in case No. RG08421763, on December 2, 2008, Chu and Tran filed
a stipulation for entry of judgment. The next day, December 3, 2008, the trial
court entered an order granting the stipulation for entry of judgment, under
which Chu waived his right to a hearing on the first and second causes of
action and made the following admissions: (1) Chu and Tran had a prior
agreement to purchase real property together, including the Subject
Property, and to cohabit as joint tenants; (2) they had a prior agreement to
hold this property for the mutual benefit of themselves and their minor
children; (3) Chu promised Tran that if they separated, he would support
Tran and their children by paying $3,500 a month in family support; and
(4) Chu, by his mismanagement, misappropriated over $1 million of their
joint assets. In settlement of Tran’s claims, Chu agreed to pay her $650,000
by “properly execut[ing] Grant Deeds transferring all aforementioned jointly
owned real properties to a Family Trust naming plaintiff LEANNA TRAN
and the Parties’ two minor children . . . as beneficiaries.” This unnamed
“Family Trust” is not identified anywhere in the stipulated judgment.
      On December 9, 2008, while our case remained pending, Chu and Tran
recorded a grant deed in the Alameda County Clerk-Recorder’s Office
transferring the Subject Property to the “DERECONN FAMILY TRUST”
(aka, the Trust). However, it was not until nearly a month later, on
January 7, 2009, that Tran, named as trustor, executed the “Dereconn
Family Trust” instrument before a notary. This instrument assigned three

                                           3
properties, including the Subject Property, to the Trust, and named Benjamin
Zhou as appointed trustee and Tran and her two children as beneficiaries.
      On May 6, 2009, following trial, a final judgment was entered in this
matter in favor of Katoozian and against Chu and US Home Center in the
amount of $162,488.03, which included special and general damages,
attorney fees and costs.
      On June 28, 2010, Katoozian filed case No. RG10522470, also in
Alameda County Superior Court, against Chu and Vivian Chen2 to set aside
the transfer of the Subject Property to the Trust as fraudulent and for
damages based on conspiracy. In case No. RG10522470, Katoozian alleged
inter alia that Chu made this transfer with the “intent to hinder, delay or
defraud” her in the collection of the $162,488.03 judgment in this case.
Neither Tran nor the trustee of the Trust (Zhou) was named as a party to this
lawsuit.
      Meanwhile, in this case, Chu underwent a court-ordered judgment
debtor’s examination on April 27, 2011. Tran was then examined on July 27,
2011, pursuant to a court order served on June 14, 2011.
      On July 11, 2011, Chu filed a bankruptcy petition in federal court, and
on July 15, 2011, he filed notices of automatic stay in this case and in case
No. RG10522470.
      Katoozian subsequently filed a complaint in federal bankruptcy court
challenging the discharge of the $162,488.03 judgment that she obtained in
this case against Chu. On August 16, 2013, after a trial, the federal
bankruptcy court agreed with Katoozian and entered a judgment against Chu
stating: “[Katoozian’s] state court judgment in the amount of $162,488.03,

      2It was alleged therein that, among other things, Chu transferred by
grant deed his interest in other property to Chen as a “ ‘gift.’ ”

                                       4
including attorney’s fees award by the court, along with post-award interest
at the applicable legal rate is ordered to be exempt from discharge pursuant
to 11 U.S.C. Sec. 523(a)(2)(A).”3
      Following this federal court judgment, the trial court in case No.
RG10522470 lifted the stay and set the matter for trial. After Chu failed to
appear, the trial court entered a default judgment against him on May 5,
2015, providing that “the transfer from defendant CHU to the Dereconn
Family Trust regarding the [Subject Property] is set aside and declared void
as to the plaintiff herein to the extent necessary to satisfy plaintiff’s
judgment in the sum of $162,488.03 . . . .” In addition, the court issued an
order pendente lite “enjoining and restraining defendants and their
representatives, attorneys, and agents from selling, transferring, conveying,
assigning, or otherwise disposing of any of the property transferred,” and
declared the judgment in this case to be “a lien on the property transferred.”
Chu did not appeal this judgment.
      On July 23, 2015, the Trust filed a motion to set aside the default
judgment in case No. RG10522470, supported by a declaration submitted by
Tran. In her declaration, Tran attested that the judgment affected property
owned by the Trust, which “ ‘is an irrevocable trust formed on or around
December 10, 2008 pursuant to Stipulation and Order Re: Conditional
Settlement, filed on December 3, 2008 in the Alameda County Superior
Court, Case no. RG08421763’ . . . .” Tran further attested that Chu was not a

      3 11 U.S.C. section 523(a)(2)(A) provides in relevant part: “(a) A
discharge under section 727, 1141, 1192, 1228(a), 1228(b), or 1328(b) of this
title does not discharge an individual debtor from any debt— [¶] . . . [¶] (2) for
money, property, services, or an extension, renewal, or refinancing of credit,
to the extent obtained by— [¶] (A) false pretenses, a false representation, or
actual fraud, other than a statement respecting the debtor’s or an insider’s
financial condition.”

                                         5
trustor or beneficiary of the Trust and that the Trust had not been named as
a party in case No. RG10522470.4
      On November 17, 2015, the trial court in case No. RG10522470 denied
the Trust’s motion to set aside the judgment on the procedural ground that
an action must be prosecuted in the name of the real party in interest and,
here, the trustee, not the Trust, is the real party in interest. The court
further noted that the stipulation and order in case No. RG08421763 does not
mention the Trust by name.5
      Despite the court’s ruling, this set aside motion was never renewed to
correct the procedural error (which was originally pointed out in Katoozian’s
opposition papers); nor was an appeal taken. However, on May 3, 2016, Chu
and Tran signed a “Correcting Grant Deed” that purported to grant the
Subject Property to “LEANNA TRAN, as Trustee of the DERECONN
FAMILY TRUST.” (Some all caps omitted.) The “Correcting Grant Deed”
was recorded on May 9, 2016.
      On May 11, 2016, under a writ of execution issued by the court in this
matter on April 13, 2016, the Alameda County Sheriff levied on the Subject
Property to satisfy the $162,488.03 judgment against Chu, plus postjudgment
interest and fees, for an amount totaling $275,741.95.

      4 On June 30, 2015, Zhou resigned as trustee of the Trust. Although
Tran represented that she became the successor trustee, there is no evidence
in the record that the appropriate procedures in the trust instrument for
replacing a resigned trustee were followed.
      5 The stipulation and order filed with the court merely states that Chu
agreed to transfer his ownership interest in the Subject Property (and two
other properties) to “a Family Trust naming [Tran] and the Parties’ two
minor children . . . as beneficiaries” in satisfaction of Chu and Tran’s
stipulated judgment.

                                        6
      On November 16, 2016, Tran filed the instant third party claim for
exemption pursuant to Code of Civil Procedure section 720.110, asserting
that she held title to the Subject Property as trustee of the Trust. This claim
underlies the present appeal.
      In December 2016, Katoozian petitioned for hearing on Tran’s third
party exemption claim. In a bifurcated hearing, the trial court first
considered the threshold issue of “whether [Katoozian] is barred from levying
on the [Subject] Property on her judgment against CHU, based upon the
limitations period set forth in [Code of Civil Procedure] §708.120(c) or other
statute.” On August 4, 2017, the trial court issued a “FINAL ORDER RE:
STATUTE OF LIMITATIONS,” concluding Katoozian was not time-barred by
any such statute. A hearing on the merits then began in June 2018, at which
Tran, Katoozian, and Zhou testified. Closing arguments were heard in
September 2018.
      On January 11, 2019, the trial court issued an order after hearing
denying Tran’s claim, which was followed by an amended order on
January 14, 2019. This amended order stated: “[T]he Court has taken into
consideration all of the arguments and claims being made by [the parties]
and, after reviewing the evidence as a whole, DECLINES to (1) vacate and
set aside the court’s original judgment [in this case] against Chu;
(2) DECLINES to set aside the court’s order voiding the grant deed
transferring CHU’s interest in the PROPERTY to Third Party Claimant,
having made an independent finding that the grant deed was fraudulent

                                       7
transfer; and (3) DECLINES to grant Third Party TRAN’S Claim for
Exemption.” (Sic.) Tran’s timely appeal followed.6
                                    DISCUSSION
        Tran’s main contention is that the seven-year statute of repose set forth
in Civil Code section 3439.09, subdivision (c)7 (section 3439.09(c)) or some
other applicable statute of limitations absolutely bars Katoozian from seeking
to execute on any judgment or obtaining a levy against the Subject Property.
Additionally, Tran contends the default judgment against Chu in case No.
RG10522470, which set aside and declared void the transfer of the Subject
Property to the Trust, is itself void because it deprived Tran, who was not a
party to case No. RG10522470, of her ownership interest in the Subject
Property without affording her notice and an opportunity to be heard. Last,
Tran contends the trial court erroneously found that: (1) she had no
equitable interest in the Subject Property; (2) the Trust was an illegal vehicle
established in order to prevent Katoozian from collecting on her $162,488.03
judgment against Chu; and (3) Tran and Chu were previously married,
rendering this judgment a community debt. We address these contentions in
turn below.
I.      Legal Framework.
        “Where personal property has been levied upon (whether by writ of
attachment, writ of execution, writ of sale or writ of possession), a party
claiming a security interest or lien may file a third party claim pursuant to
Code of Civil Procedure section 720.210 et seq. [Citation.] After filing a

       Tran’s notice of appeal identifies the trial court’s orders of January
        6

11 and 14, 2019. However, the January 14, 2019 order is simply an amended
version of the original order dated January 11, 2019.
        7   Unless otherwise stated, all statutory citations herein are to the Civil
Code.

                                            8
claim with the levying officer setting forth its security interest, the secured
party may petition the court for a hearing to determine the validity of the
third party claim and the correct disposition of the property. (Code Civ.
Proc., § 720.310, subd. (a); [citation].)” (Oxford Street Properties, LLC v.
Rehabilitation Associates, LLC (2012) 206 Cal.App.4th 296, 307, fn. omitted
(Oxford Street).) The third party claimant bears the burden to prove the
validity of its claim of an ownership interest in the property. (Ibid.; Code Civ.
Proc., § 720.360.) If the third party meets its burden, the burden then shifts
to the creditor (here, Katoozian) to establish that its interest in the property
is superior. (Oxford Street, supra, at p. 307; see Whitehouse v. Six Corp.
(1995) 40 Cal.App.4th 527, 535 [creditor bears the burden of proving its
allegation that the property transfers to the third party claimant were
fraudulent].)
      On appeal, we review the trial court’s factual findings for substantial
evidence. (Oxford Street, supra, 206 Cal.App.4th at p. 307.) In doing so, we
review the record for any evidence, contradicted or uncontradicted, that
supports the trial court’s findings, indulging all legitimate and reasonable
inferences in favor of upholding those findings. (Ibid.; Western States
Petroleum Assn. v. Superior Court (1995) 9 Cal.4th 559, 571.)
      Where a purely legal issue is raised on appeal, we review it de novo.
(Ghirardo v. Antonioli (1994) 8 Cal.4th 791, 799–800.)
II.   No forfeiture as to the statute of repose or the statutes of
      limitations.
      Tran contends section 3439.09(c)’s seven-year statute of repose8 or
some other, shorter statute of limitations precludes Katoozian from reaching

      8 Section 3439.09(c) provides that “a cause of action under this chapter
with respect to a transfer or obligation is extinguished if no action is brought
or levy made within seven years after the transfer was made or the obligation

                                        9
the Subject Property to satisfy her judgment against Chu because the grant
deed transferring the Subject Property to the Trust was recorded on
December 9, 2008, yet the Subject Property was not levied upon until May
2016, over seven years later.
      Katoozian responds that Tran forfeited the right to raise her timeliness
challenge because her notice of appeal does not identify the “FINAL ORDER
RE: STATUTE OF LIMITATIONS” issued by the trial court on August 4,
2017. Katoozian is incorrect. Notwithstanding its nomenclature, the final
order re: statute of limitations was an interlocutory order on Tran’s statute of
limitations claim rather than an appealable final judgment. (Code Civ. Proc.,
§ 904.1; see Code Civ. Proc., § 597; Gavin W. v. YMCA of Metropolitan Los
Angeles (2003) 106 Cal.App.4th 662, 669 [“ ‘ “When . . . the court proceeds to
try a special defense which does not constitute a bar to the entire action
before the trial of any other issue, and the decision on such special defense is
in favor of the defendant, the proper procedure is to make a minute order to
that effect, proceed to the trial of the remaining issues, make findings of fact
and conclusions of law on all issues, and render judgment accordingly. In
such a case, the decision of the court on the special defense and all rulings on
it may be reviewed on appeal from the judgment” ’ ”].)
      Moreover, the August 4, 2017 order did not address the statute of
repose under section 3439.09(c). A statute of repose is distinct from a statute
of limitations and, unlike a statute of limitations, may not be forfeited.
“ ‘ “While the running of a statute of limitations will nullify a party’s remedy,
the running of a statute of repose will extinguish both the remedy and the
right. The statute of limitations is therefore a procedural mechanism, which

was incurred.” (See PGA West Residential Assn., Inc. v. Hulven Internat., Inc.
(2017) 14 Cal.App.5th 156, 179 (PGA West).)

                                       10
may be waived [i.e., forfeited]. On the other hand, the statute of repose is a
substantive provision which may not be waived [i.e., forfeited] because the
time limit expressly qualifies the right which the statute creates.” ’
[Citation.]” (PGA West, supra, 14 Cal.App.5th at p. 186.) The effect of a
statute of repose “ ‘thus is harsher than a statute of limitations in that it cuts
off a right of action after a specified period of time, irrespective of accrual or
even notice that a legal right has been invaded. [Citation.]’ ” (McCann v.
Foster Wheeler LLC (2010) 48 Cal.4th 68, 78, fn. 2.)
       Under this authority, we thus proceed to the merits of Tran’s
challenges under the statutes of repose and limitations.
III.   Tran’s untimeliness claims fail.
       In her own words, Tran’s “principal defense” is this: “The instant levy
was issued outside the 7-year statute of repose at [section 3439.09(c)]. It was
issued more than 7 and half years [sic] after the transferee [Tran] and the
judgment debtor [Chu] entered a stipulated judgment and recorded a deed to
transfer the subject asset. This means all claims that the judgment creditor
[Katoozian] might bring in avoidance of those transactions . . . stand
extinguished. It also means that [Katoozian] must live with the results of
that stipulated judgment as a matter of issue preclusion.” In fact, Tran
raises over a dozen arguments in her opening brief premised on section
3439.09(c). Because, for reasons that follow, we conclude Tran’s premise is
wrong, we collectively dispose of all of her arguments under section
3439.09(c) without discussing them individually.
       We first turn to the statutory language, which states, “Notwithstanding
any other provision of law, a cause of action under this chapter with respect
to a transfer or obligation is extinguished if no action is brought or levy made

                                        11
within seven years after the transfer was made or the obligation was
incurred.” (§ 3439.09(c), italics added.)
      This language is consistent with the statutory scheme as a whole.
Section 3439.09(c) is part of the Uniform Voidable Transactions Act (UVTA)
(§ 3439 et seq.). Under the UVTA, a fraudulent conveyance “ ‘is a transfer by
the debtor of property to a third person undertaken with the intent to prevent
a creditor from reaching that interest to satisfy its claim.’ [Citation.]”
(Kirkeby v. Superior Court (2004) 33 Cal.4th 642, 648.) “ ‘A creditor who is
damaged by a transfer described in either section 3439.04 or section 3439.05
can set the transfer aside or seek other appropriate relief under . . . section
3439.07.’ [Citation.]” (Potter v. Alliance United Ins. Co. (2019) 37
Cal.App.5th 894, 904.) “A key feature of the UFTA[9] is that a creditor is
permitted, but not required, to maintain an action to annul a fraudulent
conveyance before his debt has matured. [Citations.] As stated in
Weisenburg v. Cragholm (1971) 5 Cal.3d 892, 896 [citations], ‘it is no longer
necessary that a creditor reduce his claim to judgment before seeking the
benefit of the remedy. [Fn. omitted.]’ ” (Cortez v. Vogt (1997) 52 Cal.App.4th
917, 930 & fn. 12.) In other words, the creditor has a choice: to await
judgment in an action on the underlying debt and then file an action to set
aside a fraudulent transfer, or to immediately file the set aside action.
      Consistent with this choice, section 3439.09(c) only extinguishes a
cause of action for a fraudulent transfer if the creditor fails to bring the
action or to obtain a levy within the seven-year time frame. (§ 3439.09(c).)
The statute does not require both events to have occurred within that time

      9 The UVTA was formerly known as the Uniform Fraudulent Transfers
Act (UFTA) until it was amended and renamed effective January 1, 2016.
(Stats. 2015, ch. 44, § 3.)

                                        12
frame. (In re Jesusa V. (2004) 32 Cal.4th 588, 622 [“The ‘ “ordinary and
popular” ’ meaning of the word ‘or’ is well settled. [Citation.] It has a
disjunctive meaning: ‘In its ordinary sense, the function of the word “or” is to
mark an alternative’ ”].)
      Here, Katoozian filed case No. RG10522470 to set aside Chu’s
fraudulent December 9, 2008 transfer of the Subject Property on June 28,
2010. Clearly, her lawsuit, filed less than two years after the fraudulent
transfer, is timely. Moreover, Tran’s attempt to avoid this result by focusing
on the fact that the Subject Property was not levied upon until seven and a
half years after its transfer violates basic tenets of statutory construction. It
goes without saying that we must read a statute in its entirety rather than in
piecemeal fashion, giving expression to each of its words and phrases.
(Phelps v. Stostad (1997) 16 Cal.4th 23, 32; see In re Jesusa V., supra, 32
Cal.4th at p. 622.) Section 3439.09(c), thus, does not help Tran on appeal.
      These same facts defeat Tran’s statute of limitations claims. Tran
relies upon the four-year statute of limitations under the UVTA for
intentional fraud (Civ. Code, § 3439.09, subd. (a))10 and the three-year statute
of limitations for canceling a deed on the basis of fraud (Code Civ. Proc.,
§ 338, subd. (d)).11 Given that Katoozian filed her set aside action (case No.

      10 Civil Code section 3439.09, subdivision (a) provides in relevant part,
“A cause of action with respect to a transfer or obligation under this chapter
is extinguished unless action is brought . . . or levy made . . . : [¶] (a) . . . not
later than four years after the transfer was made or the obligation was
incurred or, if later, not later than one year after the transfer or obligation
was or could reasonably have been discovered by the claimant.”
      11Code of Civil Procedure section 338, subdivision (d) provides, “Within
three years: [¶] . . . [¶] (d) An action for relief on the ground of fraud or
mistake. The cause of action in that case is not deemed to have accrued until
the discovery, by the aggrieved party, of the facts constituting the fraud or
mistake.”

                                         13
RG10522470) less than three years after the December 9, 2008 fraudulent
transfer, assuming for the sake of argument that one or both of these
limitations periods apply, Katoozian met them.
IV.     No Due Process Violation.
        Tran also contends the trial court erred by upholding the default
judgment against Chu in case No. RG10522470 that set aside and declared
void the Subject Property’s transfer to the Trust. According to Tran, this
default judgment is itself void because, in violation of her due process rights
as the Trust’s trustee, it eliminated her ownership interest in the Subject
Property even though she was not named as a party and had no notice of the
case.
        Below, the trial court rejected Tran’s due process argument after
independently considering both parties’ evidence and finding that Chu’s
transfer of the Subject Property to the Trust was appropriately set aside and
voided in case No. RG10522470. We agree with this result.
        First, Katoozian was not required to join Tran as an indispensable
party in case No. RG10522470 because Katoozian sought nothing from Tran.
Rather, Katoozian sought and obtained a judgment against Chu personally.
(See Diamond Heights Village Assn., Inc. v. Financial Freedom Senior
Funding Corp. (2011) 196 Cal.App.4th 290, 304 (Diamond Heights) [“The
Association was free to exclude Financial Freedom from the fraudulent
conveyance cause of action if it sought only a personal judgment against
Williams and Crosby”].)
        Moreover, while Tran argues that a transferee may be an indispensable
party in a fraudulent conveyance action (see § 3439.08, subd. (b)(1)(A)), Tran
was not the transferee when case No. RG10522470 was filed. Rather, the
transferee would have been the person named as the trustee of the Trust,

                                       14
which was Benjamin Zhou.12 (Portico Management Group, LLC v. Harrison
(2011) 202 Cal.App.4th 464, 473 [“ ‘Legal title to property owned by a trust is
held by the trustee . . . . ‘A . . . trust . . . is simply a collection of assets and
liabilities’ ”].) And while it appears Zhou resigned as trustee sometime in
2014 and Tran began acting as successor trustee, as the trial court noted,
there is no evidence that she was appointed successor trustee in accordance
with the governing terms of the Trust instrument.13 (See Prob. Code,
§ 21102, subd. (a) [“The intention of the transferor as expressed in the
instrument controls the legal effect of the dispositions made in the
instrument”].)
      In any event, putting aside case No. RG10522470, the record in this
case is clear that Tran, represented by counsel, presented both argument and
evidence, including her own testimony, in support of her third party claim of
exemption. Moreover, the trial court confirmed before ruling in this case that
it had “consider[ed] all of the evidence and testimony . . . .” Tran offers
nothing to dispute the trial court’s statement. As such, there is simply no
factual basis to Tran’s claim that she was deprived of due process with
respect to the trial court’s judgment, consistent with the federal bankruptcy
court’s 2013 judgment, that the December 2008 transfer of the Subject
Property to the Trust was fraudulent and therefore appropriately set aside
and voided. (See Beaudreau v. Superior Court (1975) 14 Cal.3d 448, 458 [“in

      12On September 30, 2011, Katoozian moved in case No. RG10522470 to
amend the complaint to add Zhou and Tran as parties. However, the trial
court denied her motion and dropped the matter from the calendar due to the
automatic stay issued as a result of Chu’s bankruptcy.
      13 The January 14, 2019 order notes, “There are two versions of this
trust instrument; one in which the name of the successor trustee is left blank
and another in which the name of the successor trustee is filled in by hand as
Leanna Tran.”

                                           15
every case involving a deprivation of property within the purview of the due
process clause, the Constitution requires some form of notice and a hearing”
that is “ ‘ “meaningful,” [citation] and “appropriate to the nature of the
case” ’ ”].)
V.     Substantial evidence supports the court’s findings.
       Last, we reject Tran’s evidentiary challenges to certain of the trial
court’s factual findings. When reviewing the record for substantial evidence,
“ ‘we must presume the court found every fact and drew every permissible
inference necessary to support its judgment, and defer to its determination of
credibility of the witnesses . . . .’ ” (Engineers & Architects Assn. v.
Community Development Dept. (1994) 30 Cal.App.4th 644, 653 (Engineers &
Architects); see Nestle v. City of Santa Monica (1972) 6 Cal.3d 920, 925.) For
reasons that follow, having applied this deferential standard to the record at
hand, we find no basis for disturbing the trial court’s findings.
       A.      The transfer was correctly set aside and voided.
       A transfer is fraudulent if the debtor made the transfer “[w]ith actual
intent to hinder, delay, or defraud any creditor of the debtor,” “[w]ithout
receiving a reasonably equivalent value in exchange for the transfer,” and
with the intent to incur debts beyond the debtor’s ability to pay. (§ 3439.04,
subd. (a)(1), (2); Diamond Heights, supra, 196 Cal.App.4th at pp. 303–304.)
Here, the trial court found that Chu fraudulently conveyed his interest in the
Subject Property to the Trust, with Tran and their children named as
beneficiaries, for no consideration in order to evade his debt to Katoozian. In
addition, the trial court found that the Trust did not yet exist at the time of
the December 2008 transfer, such that title to the Subject Property never
passed to the Trust. Substantial evidence supports these findings. (Bowers
v. Bernards (1984) 150 Cal.App.3d 870, 873–874 [where a factual finding is

                                         16
attacked on appeal, “the power of an appellate court begins and ends with the
determination as to whether, on the entire record, there is substantial
evidence, contradicted or uncontradicted, which will support the
determination”].)
      Tran maintains that the Trust was created by the December 3, 2008
order granting Tran and Chu’s stipulation for entry of judgment in case No.
RG08421763. However, under this order and based on Chu’s purported
admission that he was indebted to Tran in the amount of $650,000, Chu
agreed to transfer his ownership interest in the Subject Property (and two
other properties) to an unnamed “Family Trust.” A week later, on
December 9, 2008, after Katoozian received a favorable arbitration award in
this case,14 a purported grant deed was recorded by Chu and Tran in the
Alameda County Clerk-Recorder’s Office granting the Subject Property to the
“DERECONN FAMILY TRUST” (aka, the Trust). Yet, on December 9, 2008,
the Trust did not exist. It was not until January 7, 2009, that Tran, as
trustor, executed the “ ‘Dereconn Family Trust’ ” instrument before a notary
appointing Zhou as trustee and assigning the Subject Property and two other
properties to the Trust with herself and their two children as beneficiaries.
      This record constitutes substantial evidence in support of the trial
court’s conclusion that Chu’s transfer of the Subject Property to the Trust
was both fraudulent and legally ineffective, as title to property cannot be held
by a nonexistent entity. (See Diamond Heights, supra, 196 Cal.App.4th at
pp. 303–304; Diocese of San Joaquin v. Gunner (2016) 246 Cal.App.4th 254,
273 [“an attempted conveyance of real property to a nonexistent entity is
void” because “[t]itle cannot be held by an entity that does not exist”].)

      14This arbitration award was not accepted, and the matter was placed
back on the court calendar for trial.

                                       17
      Continuing her attempts to evade this result, Tran argues that certain
equitable doctrines, including judicial or direct estoppel and issue preclusion,
preclude Katoozian from arguing that the Subject Property never left Chu’s
hands because she previously relied on the “inconsistent” argument that the
transfer was made without adequate consideration.
      We disagree. Katoozian has consistently, and correctly, urged in court
that Chu devised the Trust as a way to avoid payment of the judgment she
obtained against him. Whether the Trust was never formed or was formed
for an illegal purpose in violation of section 3439.04, subdivision (a), the
result is the same: Chu’s interest in the Subject Property was never legally
transferred to the Trust. Equity does not preclude Katoozian, or the court,
from pointing this out. (See ABF Capital Corp. v. Berglass (2005) 130
Cal.App.4th 825, 832 [“courts invoke judicial estoppel to prevent judicial
fraud from a litigant’s deceitful assertion of a position completely inconsistent
with one previously asserted, thus compromising the integrity of the
administration of justice by creating a risk of conflicting judicial
determinations” (italics added)]; Cloud v. Northrup Grumman Corp. (1998)
67 Cal.App.4th 995, 1018 [“ ‘judicial estoppel’ is a concept to be applied with
restraint in egregious cases only and with clear regard for the facts of the
particular case”].)15

      15 Tran’s contention that the trial court failed to adjudicate whether
this fraudulent conveyance caused injury to Katoozian is also belied by the
record. The trial court found that “credible evidence” proved that Tran and
Chu were married, the Subject Property was community property subject to
satisfaction of Chu’s debt, and “the purported transfer [of the Subject
Property to the Trust] was an improper and illegal attempt to shield assets
from potential judgment.” (Italics added.) Katoozian, who had obtained a
judgment against Chu in the amount of $162,488.03 plus interest, was
clearly injured by Chu’s “illegal attempt to shield potential assets from
judgment,” which is why the court declared the grant deed transferring the

                                        18
      Finally, Tran is wrong to suggest that the trial court erred in finding
the Trust was an illegal vehicle for defrauding creditors “without any
disputation of [Tran’s] creditability [sic] concerning her statements that the
trust was created to hold the asset for family support.” The trial court made
clear in its orders that it had considered all of the parties’ evidence. The
court was not required to specifically state for the record whether it found
Tran credible; the judgment in favor of Katoozian speaks for itself. (See
Engineers & Architects, supra, 30 Cal.App.4th at p. 653 [when reviewing the
record for substantial evidence, “ ‘we must presume the court found every fact
and drew every permissible inference necessary to support its judgment, and
defer to its determination of credibility of the witnesses’ ”]; see also Nestle v.
City of Santa Monica, supra, 6 Cal.3d at p. 925.)
      B.    Tran’s corrected grant deed was invalid.
      We hasten to add that, contrary to Tran’s suggestion, the “Correcting
Grant Deed” recorded by Tran and Chu on May 3, 2016, in no way validates
or resurrects the void property transfer. (Some all caps omitted.) As the trial
court correctly reasoned: “The attempted correction in this case took place
after entry of judgment against CHU on May 6, 2009, after recordation of an
abstract of judgment on July 31, 2009 which created a lien on the [Subject
Property], after entry of the Bankruptcy Court judgment on August 16, 2013
declaring CHU’s debt nondischargeable, after entry of judgment against CHU
on May 5, 2015, and after issuance of a writ of execution on April 13, 2016.
Judgment liens cannot be avoided by transferring real property; the lien may
be enforced against the property in the same manner and to the same extent

Subject Property to the Trust is “void as to the plaintiff herein to the extent
necessary to satisfy plaintiff’s judgment . . . .”

                                        19
as if there had been no transfer,” citing Code of Civil Procedure section
695.070 and Dieden v. Schmidt (2002) 104 Cal.App.4th 645, 651–652.
      We agree with the trial court’s analysis. (See Yvanova v. New Century
Mortgage Corp. (2016) 62 Cal.4th 919, 929 [“A void contract is without legal
effect. (Rest.2d Contracts, § 7, com. a, p. 20.) ‘It binds no one and is a mere
nullity.’ [Citation.] ‘Such a contract has no existence whatever. It has no
legal entity for any purpose and neither action nor inaction of a party to it
can validate it’ ”].)
      C.     The Subject Property was Chu and Tran’s community property.
      Tran further contends the trial court erred in finding that she was
previously married to Chu, such that the Subject Property was community
property available to satisfy Katoozian’s judgment. Tran is wrong.
      Below, Tran supported her argument with a single document—a
“Certification of No Record” from the Alameda County Clerk-Recorder’s Office
indicating that no record of marriage was found for Tran and Chu for the
period of January 1, 1992, to January 20, 2017. The trial court, meanwhile,
rejected Tran’s evidence based on several other public records in evidence,
including certified records of the Alameda County Clerk-Recorder’s Office
consisting of a grant deed for the Subject Property and multiple “interspousal
transfer grant deeds” that identify Chu and Tran as “ ‘husband and wife’ ” or
Tran as Chu’s “spouse.”
      The trial court also relied on the fact that, while Tran claimed she
immediately separated from Chu after being hospitalized on November 11,
2007, public records reflect that on November 21, 2007, Tran and Chu
together executed a $900,000 deed of trust to Metropolitan Bank
encumbering the Subject Property. And, as mentioned, it was not until after
Katoozian sued Chu in 2008 and obtained a favorable arbitration ruling

                                       20
against him that Tran filed the action against Chu for family support. Tran’s
action then quickly resulted in the stipulated judgment of December 3, 2008,
wherein Chu agreed to transfer his interest in all jointly owned real
properties, including the Subject Property to an unnamed family trust. As
we have already held (ante, pp. 16–19), this transfer was appropriately set
aside as fraudulent and declared void.16
      On this record, affording every favorable inference necessary to support
the trial court’s judgment, substantial evidence proves that Chu and Tran
were married and that the Subject Property was their community property.
(See Engineers & Architects, supra, 30 Cal.App.4th at p. 653); see also In re
Marriage of Braendle (1996) 46 Cal.App.4th 1037, 1042 [“While [the couple]
were married, section 910 of the Family Code permitted [husband’s] creditors
to go after community property to satisfy his debts ‘regardless of whether one
or both spouses are parties to the debt or to a judgment for the debt’ ”].)
      D.    Tran did not acquire an ownership interest in the Subject
            Property by equitable title.
      Last, Tran argues that the trial court erred by failing to recognize the
equitable interest she acquired in the Subject Property by: (1) maintaining
the Subject Property, servicing its loans, and paying its taxes and insurance
for 10 years; (2) maintaining “continuous adverse possession” for 10 years;
and (3) paying consideration and receiving the Subject Property’s deed, which
gave rise to a resulting trust.
      Tran’s equitable arguments are misplaced. The law of quiet title
provides a remedy “when legal title has been acquired through fraud . . . .”

      16We reject Tran’s argument that the stipulated judgment, by which
Chu attempted to illegally transfer the Subject Property to a trust in order to
defraud Katoozian, “conclusively establish[ed] that [Chu] and [Tran] were
never married but only cohabitants.”

                                       21
(Warren v. Merrill (2006) 143 Cal.App.4th 96, 114, italics added.) In such a
case, available “remedies include quieting title in the defrauded equitable
title holder’s name and making the legal title holder the constructive trustee
of the property for the benefit of the defrauded equitable titleholder.” (Ibid.)
The law of quiet title provides no remedy, however, where, as here, a legal
title holder resorts to fraud in an attempt to shield the property from a
creditor’s valid judgment. (See generally 5 Witkin, Cal. Procedure (2019)
Pleading, § 667 [“plaintiff who attacks the legal title on equitable grounds is
in effect contending that the defendant obtained legal title by fraud or similar
inequitable conduct, and must specifically allege the facts constituting that
conduct”].)
      Under these circumstances, the trial court correctly rejected Tran’s
assertions of equitable title.
                                 DISPOSITION
      The trial court orders of January 11 and 14, 2019, are affirmed.
Katoozian is entitled to costs on appeal.

                                       22
                                 _________________________
                                 Jackson, J.

WE CONCUR:

_________________________
Fujisaki, Acting P. J.

_________________________
Petrou, J.

A156465/Katoozian v. Chu

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