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What is a “Fraudulent” Transfer in California? A judgment is merely a piece of paper signed by a court that allows a creditor to take the debtor’s assets or to force a debtor to pay the debt from their income. Some judgment debtors, realizing that judgment collection methods will allow the creditor to take their assets, ... Read...
A judgment is merely a piece of paper signed by a court that allows a creditor to take the debtor’s assets or to force a debtor to pay the debt from their income. Some judgment debtors, realizing that judgment collection methods will allow the creditor to take their assets, decide to hide or dispose of their assets. For example, debtors may transfer their assets to relatives, friends, legal entities, simply place the assets under false names, or encumber their assets using fictional debts. The courts and legislature have long recognized that debtors may engage in such schemes. Accordingly, the Uniform Fraudulent Transfer Act provides remedies for creditors faced with this issue.
The purpose of California’s Uniform Fraudulent Transfer Act (UFTA) is to prevent debtors from handing out their assets before creditors can collect. For example, before filing for bankruptcy, a debtor may try to give his or her home or other properties to a relative, a close friend, or a business associate. A debtor might also try to sell their property at a discounted price. These types of transactions are illegal under California law, and may give rise to an action by creditors to void the transaction. This brings property back into the name of the debtor to allow the creditor to collect on their assets.
California Civil Code § 3439 et seq. reflects the current Uniform Fraudulent Transfer Act. The UFTA prohibits debtors from transferring or placing property beyond the reach of their creditors when that property should be available for the satisfaction of the creditors’ legitimate claims. A transfer under the UFTA is defined as “every mode, direct or indirect, absolute or conditional, voluntary or involuntary, of disposing of or parting with an asset …, and includes payment of money, release, lease, and creation of a lien or other encumbrance.” Cal. Civ. Code § 3439.01(i).
There are two types of fraudulent transfers–actual fraud and constructive fraud. Actual fraud means that the debtor had the intent to defraud a creditor. Usually, a debtor who donates his or her assets, usually to an “insider” who is a friend or family member, thereby leaving nothing to pay creditors. Constructive fraud does not require proof of an actual intent to hinder or delay a creditor’s rights. Rather, it looks to the underlying financial result of the transaction to conclude whether a fraudulent transfer has occurred. For example, where the debtor was insolvent and did not receive reasonably equivalent value for the property transferred, the transfer may be deemed constructively fraudulent.
The most common allegation is that the debtor transferred assets to third parties for less than fair value for the purpose of evading the creditor. The “actual intent” referred to in California Civil Code § 3439.04(a)(1) is determined upon consideration of eleven factors showing indicia or badges of fraud in § 3439.04(b). See Filip v. Bucurenciu (2005) 129 Cal.App.4th 825, 834. Finding actual intent places the burden of proof on the party asserting the fraudulent intent and upon a showing by a preponderance of the evidence. California Civil Code § 3439.04(c).
California Civil Code § 3439.04 provides that:
(a) A transfer made or obligation incurred by a debtor is voidable as to a creditor, whether the creditor’s claim arose before or after the transfer was made or the obligation was incurred, if the debtor made the transfer or incurred the obligation as follows:
(1) With actual intent to hinder, delay, or defraud any creditor of the debtor.
(2) Without receiving a reasonably equivalent value in exchange for the transfer or obligation, and the debtor either:
(A) Was engaged or was about to engage in a business or a transaction for which the remaining assets of the debtor were unreasonably small in relation to the business or transaction.
(B) Intended to incur, or believed or reasonably should have believed that the debtor would incur, debts beyond the debtor’s ability to pay as they became due.
(b) In determining actual intent under paragraph (1) of subdivision (a), consideration may be given, among other factors, to any or all of the following:
(1) Whether the transfer or obligation was to an insider.
(2) Whether the debtor retained possession or control of the property transferred after the transfer.
(3) Whether the transfer or obligation was disclosed or concealed.
(4) Whether before the transfer was made or obligation was incurred, the debtor had been sued or threatened with suit.
(5) Whether the transfer was of substantially all the debtor’s assets.
(6) Whether the debtor absconded.
(7) Whether the debtor removed or concealed assets.
(8) Whether the value of the consideration received by the debtor was reasonably equivalent to the value of the asset transferred or the amount of the obligation incurred.
(9) Whether the debtor was insolvent or became insolvent shortly after the transfer was made or the obligation was incurred.
(10) Whether the transfer occurred shortly before or shortly after a substantial debt was incurred.
(11) Whether the debtor transferred the essential assets of the business to a lienor that transferred the assets to an insider of the debtor.
(c) A creditor making a claim for relief under subdivision (a) has the burden of proving the elements of the claim for relief by a preponderance of the evidence.
It is not necessary that the transferor acted for the purpose of desiring to harm his or her creditors. Rather, Economy Refining & Service Co. v. Royal Nat’l Bank (1971) 20 Cal.App.3d 434, 441, found held that the debtor’s intent to make the transfer, rather than any evil intent to harm the creditor, which sufficient o find intent to defraud.
The second type of fraudulent transfer is a constructive fraudulent transfer by which the court deems a transfer made without an intent to defraud to be avoidable on the basis that the transfer was made while the debtor was insolvent and received less than reasonable equivalent value in exchange.
Under California Civil Code § 3439.05(a): “A transfer made or obligation incurred by a debtor is voidable as to a creditor whose claim arose before the transfer was made or the obligation was incurred if the debtor made the transfer or incurred the obligation without receiving a reasonably equivalent value in exchange for the transfer or obligation and the debtor was insolvent at that time or the debtor became insolvent as a result of the transfer or obligation.” Subsection (b) provides that: “A creditor making a claim for relief under subdivision (a) has the burden of proving the elements of the claim for relief by a preponderance of the evidence.”
This might arise in the context of a party who gifts their property to close relatives or friends at a time where they have creditors making claims, even if three is a lack of improper motive.
The key here is that a constructively fraudulent transfer applies only to “a creditor whose claim arose before the transfer was made or the obligation was incurred.” California Civil Code § 3439.05(a). This is in contrast to the remedies for an actual fraudulent transfer which applies “to a creditor, whether the creditor’s claim arose before or after the transfer was made or the obligation was incurred.” California Civil Code § 3439.04(a).
Mere intent to delay or defraud is not sufficient. Rather, the injury to the creditor must be shown affirmatively. “A well-established principle of the law of fraudulent transfers is, ‘A transfer in fraud of creditors may be attacked only by one who is injured thereby. Mere intent to delay or defraud is not sufficient; injury to the creditor must be shown affirmatively. In other words, prejudice to the plaintiff is essential.'” Berger v. Varum (2019) 35 Cal.App.5th 1013, 1020 (quoting Mehrtash v. Mehrtash (2001) 93 Cal.App.4th 75, 80). The effect of this rule is that wealthy debtors are free to transfer their assets so long as sufficient assets remain for creditors.
The UFTA is not the exclusive means by which a creditor may attack a fraudulent conveyance. “The UFTA is not the exclusive remedy by which fraudulent conveyances and transfers may be attacked. They may also be attacked by, as it were, a common law action. If and as such an action is brought, the applicable statute of limitations is section 338 (d) and, more importantly, the cause of action accrues not when the fraudulent transfer occurs but when the judgment against the debtor is secured (or maybe even later, depending upon the belated discovery issue).” Macedo v. Bosio (2001) 86 Cal.App.4th 1044, 1051. California Code of Civil Procedure § 338(d) provides a limitations period of three (3) years within which to bring a claim based on fraud. The rule is that: “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.”
There are many different scenarios that can lead to a fraudulent transfer lawsuit other than the actions of a simple debtor and creditor. Innocent buyers thinking they were making a great investment as well as trustees and administrators may be liable for their part. Speaking with a trusted and knowledgeable fraudulent transfer attorney is the best line of defense. Alternatively, an experienced fraudulent transfer attorney is also needed if you believe you have a claim under the UFTA. Wherever you stand, the attorneys at Boyd Law Orange County know this area of law well. Contact Boyd Law today to discuss the details of your case.
Where actual intent to defraud can be shown by a creditor under California Civil Code § 3439.04(a)(1), an action must be brought within four (4) years after the transfer or conveyance was made. Or, if later, within one year of when the transfer or conveyance was or could reasonably have been discovered by the creditor. Where fraudulent intent is found under California Civil Code §§ 3439.04(a)(2)(A), (B) and 3439.05, an action must be filed within four (4) years after the transfer was made. If not, the debtor has a full defense of the statute of limitations. These statutes can be applied in bankruptcy under 11 U.S.C. § 548, despite the two year statute of limitations found in the Bankruptcy Code.
Perhaps the strongest affirmative defense for debtors is the statute of repose. Specifically, California Civil Code § 3439.09 explains that no action may be brought for fraudulent transfer or avoidable conveyance more than seven (7) years after the transfer was made notwithstanding any other provision of law. This provides a defense for even the most obvious cases. Unlike a statue of limitation, a statute of repose is not subject to the fact sensitive inquiry.
Where a creditor can show that a debtor has fraudulently transferred property, the UFTA provides several remedies under California Civil Code § 3439.07, which provides that:
(a) In an action for relief against a transfer or obligation under this chapter, a creditor, subject to the limitations in Section 3439.08, may obtain:
(1) Avoidance of the transfer or obligation to the extent necessary to satisfy the creditor’s claim.
(2) An attachment or other provisional remedy against the asset transferred or its proceeds in accordance with the procedures described in Title 6.5 (commencing with Section 481.010) of Part 2 of the Code of Civil Procedure.
(3) Subject to applicable principles of equity and in accordance with applicable rules of civil procedure, the following:
(A) An injunction against further disposition by the debtor or a transferee, or both, of the asset transferred or its proceeds.
(B) Appointment of a receiver to take charge of the asset transferred or its proceeds.
(C) Any other relief the circumstances may require.
(b) If a creditor has commenced an action on a claim against the debtor, the creditor may attach the asset transferred or its proceeds if the remedy of attachment is available in the action under applicable law and the property is subject to attachment in the hands of the transferee under applicable law.
(c) If a creditor has obtained a judgment on a claim against the debtor, the creditor may levy execution on the asset transferred or its proceeds.
(d) A creditor who is an assignee of a general assignment for the benefit of creditors, as defined in Section 493.010 of the Code of Civil Procedure, may exercise any and all of the rights and remedies specified in this section if they are available to any one or more creditors of the assignor who are beneficiaries of the assignment, and, in that event (1) only to the extent the rights or remedies are so available and (2) only for the benefit of those creditors whose rights are asserted by the assignee.
Although some transfers are voidable under California Civil Code § 3439.07, it is § 3439.08(a) that embodies the good faith exception to the voidable transfer remedy. Where a debtor transferred assets with actual fraudulent intent, pursuant to § 3439.04(a)(1), § 3439.08(a) provides that the transfer is not voidable against a person who took for reasonably equivalent value and on good faith, or against subsequent transferees. The transferee’s good faith or knowledge of the debtor’s fraudulent intent may be inferred where the transferee had “notice of such facts and circumstances as would induce an ordinarily prudent man to inquire into the purpose [of the debtor in] making the conveyance.” Boness v. Richardson Mineral Springs (1956) 141 Cal.App.2d 251, 252.
To the extent the transaction is voidable pursuant to California Civil Code § 3439.04(a)(1), a creditor may obtain judgment to recover from a party other than a good faith transferee the asset or even the value of the asset under California Civil Code § 3439.08(b). Nonetheless, where the transferee is in good faith, that transferee may retain their interest or rights in the property to the extent of the value given to the debtor for the property.
Bankruptcy is a common forum for fraudulent transfer litigation. For example, fraudulent transfers in California bankruptcy can arise under 11 USC 548. This includes Ponzi scheme fraudulent transfers in bankruptcy. In fact, creditors can even allege non-dischargeability of intentional fraudulent transfer. It is important to contact a bankruptcy attorney to consider all options.
Fraudulent transfers also rise in California family law, especially marital settlement agreements. Most notably, Mejia v. Reed found that fraudulent transfer can be raised as to transmutation (post-nuptial) agreements under California law.
Any debtor who thinks that transferring money or property to friends or family will solve their problems may not be aware of the ramifications. Indeed, this may enlarge the litigation whereby the creditor will include family and friends who were unfortunate enough to be included in the transfers. If the creditor is aggressive creditor and represented by competent legal counsel, they will end up involving family, which makes the situation even worse. It is better to consider your options under bankruptcy law, particularly since the California homestead exemption may provide a place for debtors to place their money that is supported by existing law.
Our attorneys serve clients throughout Los Angeles, Orange County, San Diego, Riverside, Palm Springs, San Bernardino, & Silicon Valley. It is important to consult a real estate attorney, business litigator, or bankruptcy attorney skilled in fraudulent transfer litigation to consider your rights. Contact our fraudulent transfer attorneys today for a free consultation at (844) 4-TALKOV (825568) or contact us online.
Will Formalities in California While many people die with a will, courts do not enforce every will. Instead, courts enforce only those wills meeting specific legal requirements. Who Can Make a Will? California Probate Code section 6100 delineates that an individual 18 years or older who is of sound mind may make a will. Will ... Read...
While many people die with a will, courts do not enforce every will. Instead, courts enforce only those wills meeting specific legal requirements.
California Probate Code section 6100 delineates that an individual 18 years or older who is of sound mind may make a will.
For a will to meet the proper formalities, California Probate Code section 6110 provides that:
(a) Except as provided in this part, a will shall be in writing and satisfy the requirements of this section.
(b) The will shall be signed by one of the following:
(1) By the testator.
(2) In the testator’s name by some other person in the testator’s presence and by the testator’s direction.
(3) By a conservator pursuant to a court order to make a will under Section 2580.
(c)(1) Except as provided in paragraph (2), the will shall be witnessed by being signed, during the testator’s lifetime, by at least two persons each of whom (A) being present at the same time, witnessed either the signing of the will or the testator’s acknowledgment of the signature or of the will and (B) understand that the instrument they sign is the testator’s will.”
If the testator had previously signed alone or in the presence of just one of the witnesses, the testator need not sign again in the presence of the two witnesses but must acknowledge their signature or will (i.e., “this is my signature/will”) in the presence of the two witnesses, both present at the same time.
Importantly, the witnesses do not have to sign in front of each other or in the presence of the testator, they just have to sign the will during the testator’s lifetime.
There are two tests in California for presence:
Now, if these listed formalities are not met, a will can still be admitted to probate under California Probate Code section 6110(c)(2) if the proponent of the will establishes by clear and convincing evidence that at the time the testator signed the will, they intended the instrument to constitute their will: “If a will was not executed in compliance with paragraph (1), the will shall be treated as if it was executed in compliance with that paragraph if the proponent of the will establishes by clear and convincing evidence that, at the time the testator signed the will, the testator intended the will to constitute the testator’s will.”
A holographic will is, in essence, a hand-written will.
California Probate Code section 6111(a) provides that: “A will that does not comply with Section 6110 is valid as a holographic will, whether or not witnessed, if the signature and the material provisions are in the handwriting of the testator.”
Subsection (c) clarifies “[a]ny statement of testamentary intent contained in a holographic will may be set forth either in the testator’s own handwriting or as part of a commercially printed form will.” Thus, statements such as “this is my will” need not be in the testator’s handwriting.
The signature of the testator must be in the handwriting of the testator and the signature may appear anywhere in the will—it need not be at the end of the will.
Simply put, material provisions are “who” gets “what.” These must be in the testator’s handwriting. For example, Joanne writes “$3,000 to my son Jim Jones.” The gift of “$3,000” is material and constitutes the “what,” and “Jim Jones” is material and constitutes the “who.”
A holographic will need not contain a date. However, if a holographic will is not dated, and another will exists with inconsistent provisions and there is doubt as to which provisions are controlling, the holographic will will be deemed invalid to “the extent of the inconsistency unless the time of its execution is established to be after the date of the execution of the other will.” California Probate Code section 6111(b).
Further, “[i]f it is established that the testator lacked testamentary capacity at any time during which the will might have been executed, the will is invalid unless it is established that it was executed at a time when the testator had testamentary capacity.” California Probate Code section 6111(b)(2). Thus, even though a date is not required for a holographic will to be valid, a lack of date can present some difficulties.
Importantly, if a will does not meet either the formal requirements or the requirements for a holographic will, it may be challenged in what is called a will contest.
Our attorneys serve clients throughout Los Angeles, Orange County, San Diego, Riverside, Palm Springs, San Bernardino, & Silicon Valley. Contact our trust, probate and estate attorneys today for a free consultation at (844) 4-TALKOV (825568) or contact us online.
Our Trust, Probate and Estate Litigation Attorneys practice in the following areas:
Does the Father of an Unborn Child Have Custody Rights in California? Can the Family Court Prevent a Pregnant Woman from Moving Out of State? Find Out!
Theoretically, California family law treats mothers and fathers equally, with no preference for gender when making determinations of child custody. This, however, is simply not the case when an unborn baby is at issue.
Under California law, mothers don’t have to do anything to establish their rights to their child. The law is different for fathers.
Fathers must first establish their parental rights (i.e. father’s rights), before they are entitled to make any decisions or have any say in the life of their child, or unborn child.
However, if you are concerned about the health and safety of your unborn child for reasons of drug or alcohol abuse or domestic violence issues, it is important to contact Child Protective Services or the police for help. Although you have limited rights while your child is unborn, you may be successful in protecting your unborn child once the state investigates your allegations.
Custody laws in California do not apply to unborn children. An unborn baby obviously cannot be anywhere other than the mother’s womb, so the mother technically has “custody” of the unborn child by default of biology.
There are steps a father, or someone who believes he may be the father, can take to protect his parental and custodial rights prior to birth of a baby, however. Examples of these steps are as follows:
As the father of an unborn child, your rights are limited. An unborn baby obviously cannot be anywhere other than the mother’s womb, so child custody and parenting time don’t apply until the baby is born.
That being said, fathers of unborn babies do have some rights prior to the birth. So can a father prevent the pregnant mother of his child from moving out of California?
In short, no.
In the United States, adults have a constitutional right to travel freely (i.e. move away) and the family court cannot impede that right unless another countervailing state interest is at stake – in this case, presumably the best interests of a child. However, because a court cannot adjudicate custody of an unborn baby, and a court cannot discriminate against woman because of pregnancy, no law prohibits a pregnant woman from moving out of the state where the father resides to another state.
It is not up to fathers to dictate where pregnant women live. Everyone has the fundamental right to make the decision of where to reside for him – or herself.
Obviously, a pregnant woman cannot help but dictate the geographic itinerary of the unborn child that, by biological necessity, goes where she goes. That doesn’t mean the mother wins the custody battle in the end, but it does mean she cannot be penalized for moving to another state before the baby is born.
Under the Uniform Child Custody Jurisdiction and Enforcement Act (UCCJEA), the state with jurisdiction over a child under 6 months old is the state in which the child was born.
Thus, a pregnant woman who does not wish to litigate child custody in the state where the father lives appears to have the unbridled right to move anywhere else and have child custody determined in the jurisdiction where she lives at the time of the child’s birth.
California’s family law procedures are complex and trying to navigate them without help of a California family lawyer can be frustrating. If you have questions about family law procedures, contact our accomplished and dedicated family law, divorce, and child custody lawyers by calling (844) 4-TALKOV (825568) or contact us online for a free consultation with our experienced family law attorney, Colleen Sparks, who can guide you through the court process in a prompt and clear manner.
Our knowledgeable attorneys can also help if you have questions about any of the following:
Establishing Bona Fide Purchaser Status Under California’s Notice Rules Many conflicts arise from real property purchase disputes where a buyer, seller or other party claims priority over earlier purchasers and liens (encumbrances), including judgments. The conflicted rules applied in these quiet title actions underlie the importance of hiring a qualified real estate attorney in California. ... Read...
Many conflicts arise from real property purchase disputes where a buyer, seller or other party claims priority over earlier purchasers and liens (encumbrances), including judgments. The conflicted rules applied in these quiet title actions underlie the importance of hiring a qualified real estate attorney in California.
“It is ‘black-letter law’ that a bona fide purchaser for value who acquires his or her interest in real property without knowledge or notice of another’s prior rights or interest in the property takes the property free of such unknown interests.” In re Marriage of Cloney (2001) 91 Cal.App.4th 429, 437. Accordingly, a bona fide purchaser without notice may seek a legal determination through a quiet title action that the title it obtained remains free and clear of any adverse interest in the property. Reiner v. Danial (1989) 211 Cal.App.3d 682.
“The elements of bona fide purchase are payment of value, in good faith, and without actual or constructive notice of another’s rights.” Melendrez v. D & I Investment, Inc. (2005) 127 Cal.App.4th 1238, 1251. Conversely, “it is an equally well-established principle of law that any purchaser of real property acquires the property subject to prior interests of which he or she has actual or constructive notice.” In re Marriage of Cloney (2001) 91 Cal.App.4th 429, 437. Exactly what constitutes actual or constructive notice requires a careful analysis of the law in California.
“Actual notice is defined as ‘express information of a fact,’ while constructive notice is that ‘which is imputed by law.’ A person generally has ‘notice’ of a particular fact if that person has knowledge of circumstances which, upon reasonable inquiry, would lead to that particular fact.” In re Marriage of Cloney (2001) 91 Cal.App.4th 429, 436–437.
In 2020, the Court of Appeal explained that: “Constructive notice of a lien or other interest in property arises from the proper recording of that interest.” Vasquez v. LBS Financial Credit Union (2020) 52 Cal.App.5th 97, 107–108. This means that the law implies that every buyer has read every properly recorded instrument in the county recorder. Indeed,: “The effect of a lis pendens is to give constructive notice of all facts apparent on the face of the proceedings, and of those facts of which the facts so stated necessarily put a purchaser on inquiry; and a subsequent purchaser from a party takes subject to any judgment that may be rendered in the action of the pendency of which notice is given.” Olson v. Cornwell (1933) 134 Cal.App. 419, 426.
Many conflicts can arise from the proposition that “[a] purchaser may also have constructive notice of a fact affecting his or her property rights where the purchaser has knowledge of circumstances which, upon reasonable inquiry, would lead to that particular fact.” Vasquez v. LBS Financial Credit Union (2020) 52 Cal.App.5th 97, 108. “If the purchaser neglects to prosecute such inquiry diligently he may not be awarded the standing of a bona fide purchaser.” Asisten v. Underwood (1960) 183 Cal.App.2d 304, 310. “This type of constructive notice is often described as inquiry notice.” Vasquez v. LBS Financial Credit Union (2020) 52 Cal.App.5th 97, 108.
“In addition, notice of an adverse interest may be imputed to a purchaser from knowledge acquired by her or his agent acting within the course and scope of the agent’s authority.” Vasquez v. LBS Financial Credit Union (2020) 52 Cal.App.5th 97, 108. “The basis for imputing knowledge to the principal is that the agent has a legal duty to disclose information obtained in the course of the agency and material to the subject matter of the agency, and the agent will be presumed to have fulfilled this duty. The scope of the imputation of knowledge is directly related to the scope of the duty arising from the agency agreement; it has nothing to do with whether the agent actually has the information in question or has it only constructively, or whether it is practical to expect the agent to remember something that happened months ago.” Triple A Management Co., Inc. v. Frisone (1999) 69 Cal.App.4th 520, 534–535.
A rare form of notice is implied by law when apparent possession is inconsistent with title appearing of record. Otherwise, an encumbrancer may have a duty to inquire as to unrecorded agreements between joint owners or those in possession. Caito v. United California Bank (1978) 20 Cal.3d 694.
This article addressed only the very basic concepts of notice used to defeat or establish the status of a bona fide purchaser or encumbrancer. It is important to contact a skilled real estate litigator in California to consider your rights.
Everything You Need to Know About Successfully Requesting or Defending a Restraining Order in California!
It doesn’t matter which side of the table you are on, family law restraining orders are stressful and nerve wracking for everyone involved. They are an extremely serious matter and should not be taken lightly.
A domestic violence restraining order is a legal method of protecting people from abuse or harassment carried out by a family member, close relative, spouse or partner, or anyone who shares residence with the petitioner.
In California, a restraining order prevents a person from harassing, abusing, stalking, or threatening another person. The party that is seeking the restraining order or is protected is known as the “protected person.” The other party, i.e. the party against whom the restraining order is being sought, is known as the “restrained person.”
California law recognizes four kinds of restraining orders. These include:
This article will primarily focus on family law domestic violence restraining orders rather than the other three types of restraining orders available in California.
A domestic violence restraining order is a family court order designed to protect a person from another named party.
A person can ask for a domestic violence restraining order if:
A “close relationship” means that the two parties are:
A restraining order can include various provisions and restrictions, including the following:
Be aware, there is a difference between a “temporary” and “permanent” restraining order. A restraining order is temporary if it is issued prior to a hearing. A permanent order is a restraining order issued as a result of a hearing.
Note that even if no other acts of abuse or violations of the order have taken place since the order was made permanent, the protected party may petition the court to renew the order. The protected party must show by a preponderance of the evidence that the protected party still has a “reasonable apprehension” of future abuse.
Violation of a restraining order is a misdemeanor under California Penal Code 273.6.
In order to actually be prosecuted, the district attorney would need to prove the following, beyond a reasonable doubt:
When it comes to the temporary restraining order (TRO), not only will violation of the temporary order almost guarantee that a permanent restraining order will be granted, violation of the order is also a crime.
Proceedings for contempt of court for violation of a domestic violence restraining order can also be brought for violation of these orders.
Most restraining orders prohibit a restrained person from owning or possessing a firearm for as long as it is in effect. They also generally prohibit a restrained person from purchasing a gun.
A person that violates these prohibitions can face criminal charges per Penal Code 29825. However, this violation can be charged as a felony. There is a form (DV-800) that a restrained person must fill out related to firearms. It contains instructions related to appropriate places where restrained persons can turn in their firearms while the restraining order is pending.
The person who wants to seek protection via a domestic violence restraining order should contact a family law attorney to help draft and complete the various forms and documents necessary to get a restraining order.
Should the party seeking protection choose to proceed without an attorney, he or she must describe why he/she is requesting protection from the restrained party in the restraining order forms before submitting them to the court.
A judge then reviews the forms and decides whether or not to issue a TRO. If issued, the order will usually last for 21 days.
Following the issuance of the TRO, the court will determine whether or not to make it a permanent restraining order after hearing evidence on the matter. Prior to this hearing, notice of it must be given to the restrained party via a process server, and proof of service must be filed.
If the evidence shows that the protected party warrants a restraining order, the court issues one for a specified period of time.
Prior to the hearing on the restraining order, work on building a solid defense to each allegation against you. If there is evidence in your favor, including documents, pictures, or witnesses, be sure to let your attorney know right away.
Make sure that your declaration is as accurate as possible (avoid hyperbole, misstatements, assumptions, and speculation) and includes all information you want the court to know. You do not want to have evidence excluded because the other side was not given “notice” of a claim or the existence of evidence.
If the case involves children, begin gathering evidence about your involvement as a parent. You will want to work on overcoming the Family Code 3044 presumption that you should not be granted custody, as many parents try to use restraining orders strategically to gain an advantage in custody cases.
Consider taking a co-parenting (especially a high-conflict centered) class, parenting classes, and individual counseling. Being proactive about preventing future conflict can show the court that future abuse is unlikely to reoccur. You may also have character witnesses, though witnesses who actually perceived the events in question are more relevant and powerful.
California’s domestic violence procedures are complex and trying to navigate them without help of a California family lawyer can be frustrating. If you have questions about restraining orders, contact our accomplished and dedicated lawyers by calling (844) 4-TALKOV (825568) or contact us online for a free consultation with our experienced family law attorney, Colleen Sparks, who can guide you through the court process in a prompt and clear manner.
Our knowledgeable attorneys can also help if you have questions about any of the following:
Limits on Court Authority to Deny Bankruptcy Exemptions When a debtor files for chapter 7 or chapter 11 bankruptcy, the debtor is entitled to certain exemptions which effect creditor’s rights. The exempt property is shielded from the creditors circling around the debtor’s estate for collection of their outstanding loans. One well-known bankruptcy exemption is the ... Read...
When a debtor files for chapter 7 or chapter 11 bankruptcy, the debtor is entitled to certain exemptions which effect creditor’s rights. The exempt property is shielded from the creditors circling around the debtor’s estate for collection of their outstanding loans. One well-known bankruptcy exemption is the homestead exemption (recently expanded to provide greater protection to debtors in California).
There are avenues which will allow a trustee to deny exemptions claimed by the debtor. In addition to these exemption denials, the presiding bankruptcy court may also order otherwise exempt property liable to be used to pay down certain kinds of prepetition debts pursuant to exceptions laid out in 11 U.S.C. § 522.
Moreover, § 522 sets forth a number of carefully calibrated exceptions and limitations, some of which relate to the debtor’s misconduct. For example, § 522(c) makes exempt property liable for certain kinds of prepetition debts, including debts arising from tax fraud, fraud in connection with student loans, and other specified types of wrongdoing. Section 522(o) prevents a debtor from claiming a homestead exemption to the extent he acquired the homestead with nonexempt property in the previous 10 years “with the intent to hinder, delay, or defraud a creditor.” And § 522(q) caps a debtor’s homestead exemption at approximately $150,000 (but does not eliminate it entirely) where the debtor has been convicted of a felony that shows “that the filing of the case was an abuse of the provisions of” the Code, or where the debtor owes a debt arising from specified wrongful acts—such as securities fraud, civil violations of the Racketeer Influenced and Corrupt Organizations Act, or “any criminal act, intentional tort, or willful or reckless misconduct that caused serious physical injury or death to another individual in the preceding 5 years.” § 522(q) and note following § 522. The Code’s meticulous—not to say mind-numbingly detailed—enumeration of exemptions and exceptions to those exemptions confirms that courts are not authorized to create additional exceptions. See Hillman v. Maretta, 133 S.Ct. 1943, 1953, 186 L.Ed.2d 43 (2013); TRW Inc. v. Andrews, 534 U.S. 19, 28–29, 122 S.Ct. 441, 151 L.Ed.2d 339 (2001).
Law v. Siegel, 571 U.S. 415, 424 (2014) (emphasis added).
Bankruptcy Rule 1009 allows a debtor to amend its list of exemptions at any time before the case is closed.
There were two universally recognized exceptions to this general rule disallowing a debtor from amending its exemptions when the debtor acted in bad faith and when allowing the amendment would result in prejudice to creditors. Thus, courts would universally deny exemption claims when a debtor had fraudulently concealed assets and engaged in other conduct which resulted in prejudice to the creditors whose rights were affected by the claimed exemption. This universal denial of a debtor’s claimed exemptions was significantly altered by Law v. Siegel, 571 U.S. 415, 424 (2014) .
Law v. Siegel, 571 U.S. 415, 424 (2014) noted, in dicta, beyond these “carefully calibrated exceptions and limitations” within the bankruptcy code limiting the debtor’s ability to exempt certain property from its estate, a Court’s ability to except property from being claimed as an exemption is limited.
Siegel points out that a handful of courts have claimed authority to disallow an exemption (or to bar a debtor from amending his schedules to claim an exemption, which is much the same thing) based on the debtor’s fraudulent concealment of the asset alleged to be exempt. … He suggests that those decisions reflect a general, equitable power in bankruptcy courts to deny exemptions based on a debtor’s bad-faith conduct. For the reasons we have given, the Bankruptcy Code admits no such power. It is of course true that when a debtor claims a state-created exemption, the exemption’s scope is determined by state law, which may provide that certain types of debtor misconduct warrant denial of the exemption. … Some of the early decisions on which Siegel relies, and which the Fifth Circuit cited in Stewart, are instances in which federal courts applied state law to disallow state-created exemptions. … But federal law provides no authority for bankruptcy courts to deny an exemption on a ground not specified in the Code.
Given that the Supreme Court has held that the debtor’s bad faith conduct may not lead to a denial of a claimed exemption amount, it necessarily follows that creditor’s rights will be negatively effected. Indeed, the Supreme Court noted the potential for deleterious effects arising from it’s holding.
We acknowledge that our ruling forces Siegel to shoulder a heavy financial burden resulting from Law’s egregious misconduct, and that it may produce inequitable results for trustees and creditors in other cases. We have recognized, however, that in crafting the provisions of § 522, “Congress balanced the difficult choices that exemption limits impose on debtors with the economic harm that exemptions visit on creditors.” Schwab v. Reilly, 560 U.S. 770, 791, 130 S.Ct. 2652, 177 L.Ed.2d 234 (2010). The same can be said of the limits imposed on recovery of administrative expenses by trustees. For the reasons we have explained, it is not for courts to alter the balance struck by the statute. Cf. Guidry v. Sheet Metal Workers Nat. Pension Fund, 493 U.S. 365, 376–377, 110 S.Ct. 680, 107 L.Ed.2d 782 (1990).
Given these limits on the sitting Court’s ability to protect creditors from a debtor’s bad faith conduct, the question becomes: what is really preventing a debtor from hiding its assets in a bad faith manner? The Supreme Court noted that it believes the sitting court will still be able to sufficiently protect creditors despite its ruling.
Our decision today does not denude bankruptcy courts of the essential “authority to respond to debtor misconduct with meaningful sanctions.” … There is ample authority to deny the dishonest debtor a discharge. See § 727(a)(2)-(6). (That sanction lacks bite here, since by reason of a postpetition settlement between Siegel and Law’s major creditor, Law has no debts left to discharge; but that will not often be the case.) In addition, Federal Rule of Bankruptcy Procedure 9011—bankruptcy’s analogue to Civil Rule 11—authorizes the court to impose sanctions for bad-faith litigation conduct, which may include “an order directing payment … of some or all of the reasonable attorneys’ fees and other expenses incurred as a direct result of the violation.” Fed. Rule Bkrtcy. Proc. 9011(c)(2). The court may also possess further sanctioning authority under either § 105(a) or its inherent powers. Cf. Chambers, 501 U.S., at 45–49, 111 S.Ct. 2123. And because it arises postpetition, a bankruptcy court’s monetary sanction survives the bankruptcy case and is thereafter enforceable through the normal procedures for collecting money judgments. See § 727(b). Fraudulent conduct in a bankruptcy case may also subject a debtor to criminal prosecution under 18 U.S.C. § 152, which carries a maximum penalty of five years’ imprisonment.
But whatever other sanctions a bankruptcy court may impose on a dishonest debtor, it may not contravene express provisions of the Bankruptcy Code by ordering that the debtor’s exempt property be used to pay debts and expenses for which that property is not liable under the Code.
Recently, courts have grappled with the issue of whether they are bound by the dicta in Law disallowing a bankruptcy court to abrogate a debtor’s exemption claim based on the bad faith conduct of the debtor.
We may not reach the merits of the trustee’s objection to Ms. Bogan’s claim of exemptions on bad faith grounds. The bankruptcy code does not authorize such determinations. We must overrule the trustee’s objection. It may be so ordered.
A bankruptcy court has no authority under federal law to deny a debtor’s claim of exemptions on a ground that is not specified in the bankruptcy code.
Application of Siegel, therefore, requires this Court allow the Amendment Motion, as the Court is limited in its authority to deny the Debtor leave to amend his exemptions whether there was bad faith conduct or not.
Furthermore, to apply Siegel to this situation could arguably act as an open invitation for debtors to commit fraud in claiming exemptions, knowing that the Bankruptcy Court would be powerless to deny such. As a matter of policy, this is not only inappropriate, but for no apparent reason differentiates this particular situation from the other fraud inquiries under the Bankruptcy Code, which historically at least are unquestionably within the authority of the Bankruptcy Court to adjudicate. That, coupled with the very basic need for the Bankruptcy Court to maintain and enforce the integrity of the entire system, require that at the very least eliminating the authority of that Court to deal with fraud in this situation should either be as a result of (a) a clear statutory enactment or (b) specific binding decisional authority in a substantively analogous case, as opposed to the application of what needs to be seen as dictum and otherwise unwarranted.
We therefore reject the trustee’s artificial delineation and hold that, under Siegel, bankruptcy courts o not have the authority to use their equitable powers to disallow exemptions or amendments to exemptions due to bad faith or misconduct.
Given that creditor’s rights are negatively affected by the foregoing, it would benefit any party negatively influenced by a debtor’s bad faith conduct to contact an experienced bankruptcy attorney to figure out what other means may be available to protect their rights. Talkov Law can be reached at p(844) 4-TALKOV (825568) or contact us online.
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