Fraudulent Transfer - Appellate Court Upholds Judgment In Favor Of Creditor Against Wife Of Debtor

HARRIS NA v. Harris, Ill: Appellate Court, 1st Dist., 1st Div. 2012 - Google Scholar:

This is an appeal from a grant of summary judgment in favor of Harris Bank against Sheri Harris, the ex-wife of Stuart Levine.

The bank alleged that in 2002 Levine allegedly defaulted on a $3.3 million dollar note due to the Bank and to avoid collection had transferred assets to his wife for no consideration.  The asset transfers rendered Levine insolvent, so he was unable to pay Harris bank.

Ms. Harris argued that the bank's case was barred by a 2008 federal forfeiture judgment.  The trial court and the appellate court disagreed, holding instead that the forfeiture judgment only applied to two of Levine's assets, not the rest of the disputed property.

The court found that Ms. Harris forfeited two arguments (a) that there was adequate consideration for the transfers; and (b) that the property was marital property in which she had a 50% interest, because Ms. Harris failed to raise these issues before the trial court.  The court states: "Because neither this argument nor any evidence supporting it was presented to the circuit court, we deem the argument forfeited on appeal. See Cooney v. Magnabosco,407 Ill. App. 3d 264, 268, 943 N.E.2d 290 (2011) (stating that an appellant that fails to raise an issue in the circuit court waives that issue for purposes of appeal)."

In sum, a classic fraudulent transfer case.

Edward X. Clinton, Jr.

www.clintonlaw.net



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