Citizens Business Bank v. De Mille, 2010 Cal.App. Unpub. LEXIS 4316

The institutional trustee for a family trust won a judgment (which GMSR successfully defended on appeal) ordering the former trustee to pay the trust more than $1 million in damages. The former trustee posted a $1 million undertaking to stay enforcement of the judgment and then, after the trial court found the undertaking inadequate, purported to have transferred all of his assets to his son. The trial court held that the trust could enforce the undertaking and that the purported transfer was void. The Court of Appeal affirmed both rulings. It held, as GMSR argued, that the undertaking was enforceable under a statute that makes a guarantor liable even if its bond is defective. The court further affirmed that the purported asset transfer was void because it was not accompanied by an actual change in possession as required by the fraudulent transfer statute.

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