Guerrand-Hermes v. Guerrand-Hermes

• Decision Date: 29 June 2006
• Docket Number: 7382N.,7383N.
• Citation: 2006 NY Slip Op 05202,30 A.D.3d 339,819 N.Y.S.2d 231
• Parties: PATRICK GUERRAND-HERMES, Appellant, v. OLAF GUERRAND-HERMES, Defendant. OLGA ROSTROPOVICH, Nonparty Respondent.
• Court: New York Supreme Court — Appellate Division

30 A.D.3d 339

819 N.Y.S.2d 231

2006 NY Slip Op 05202

PATRICK GUERRAND-HERMES, Appellant, v. OLAF GUERRAND-HERMES, Defendant.

OLGA ROSTROPOVICH, Nonparty Respondent.

7382N.

7383N.

Appellate Division of the Supreme Court of the State of New York, First Department.

June 29, 2006.

Order, Supreme Court, New York County (Emily Jane Goodman, J.), entered April 1, 2004, which granted the motion of nonparty respondent pursuant to Debtor and Creditor Law § 276 to vacate a judgment of confession entered against defendant in favor of plaintiff, Patrick Guerrand-Hermes, reversed, on the law, without costs, and the matter remanded for a hearing.

Plaintiff-appellant Patrick Guerrand-Hermes is defendant's father. On October 8, 2003, defendant executed an affidavit of confession of judgment in favor of his father, purportedly to repay a loan of $200,000 made in installments in November 2002 and March 2003. In December 2003, defendant's ex-wife, nonparty respondent Rostropovich, moved to vacate the judgment by confession on the grounds that she was a creditor of defendant, and that the judgment was a fraudulent conveyance. Supreme Court granted the motion.

For the reasons stated in the related action, Micalden Invs. S.A. v Guerrand-Hermes (30 AD3d 341 [2006] [decided herewith]), we reverse. The dissent's reliance on Posner v S. Paul Posner 1976 Irrevocable Family Trust (12 AD3d 177 [2004]) in the instant case, does not alter this conclusion. In Posner, the plaintiff controlled the trust through his wife and caused a confession of judgment to be filed in his favor moments after a directed verdict was entered against the trust. We held that the "circumstances demonstrate that the confession of judgment was not given and taken in good faith" (id. at 178).

In this case, defendant's "honest purpose" in making the judgment by confession remains a question of fact, and fraudulent intent must be proved by clear and convincing evidence. Accordingly, we reverse the motion court's summary determination and remand for a hearing pursuant to section 276 of the Debtor and Creditor Law.

Concur — Buckley, P.J., Catterson and Malone, JJ.

Andrias, J., dissents in a memorandum as follows:

The motion court's summary determination that defendant husband's confession of judgment, dated October 8, 2003, in favor of his father, plaintiff herein, in the sum of $200,000 was a fraudulent conveyance pursuant to Debtor and Creditor Law § 276 (conveyance made with actual intent, as distinguished from intent presumed in law, to hinder, delay, or defraud present or future creditors) was correct. Accordingly, I dissent and would affirm the order granting nonparty respondent's motion to vacate a judgment by confession entered against defendant, respondent's former husband, and in favor of plaintiff, defendant's father.

In opposition to the nonparty former wife's motion, plaintiff father merely stated that the judgment was in no way fraudulent inasmuch as it was based on two loans he made to his son, each in the amount of $100,000, first in November 2002 to enable his son to pay outstanding mortgage and maintenance due on the marital apartment in the Hotel des Artistes and the second, in March 2003, to nonparty respondent, his former daughter-in-law, on account of his son's obligations to her. As found by...