LB Judgment Holdings, LLC v. Boschetti
| Decision Date | 13 March 2019 |
| Docket Number | 3D18-1323,3D18-1726,Nos. 3D18-1190,s. 3D18-1190 |
| Citation | 271 So.3d 115 |
| Parties | LB JUDGMENT HOLDINGS, LLC, Appellant, v. Luis R. BOSCHETTI, et al., Appellees. |
| Court | Florida District Court of Appeals |
Alejandro Vilarello, for appellant.
Bell Rosquete Reyes and Javier A. Reyes and Armando Rosquete ; Aran Correa & Guarch and Alexander Esteban and Jorge A. Perez, Coral Gables; Greenberg Traurig, P.A., and Julissa Rodriguez and Stephanie L. Varela, Miami; Sanchez-Medina, Gonzalez, Quesada, Lage, Gomez & Machado LLP, and Peter A. Gonzalez and James C. Kellner, Coral Gables; Peterson, Baldor & Maranges, PLLC, and Matthew Maranges, Michael P. Peterson, Jose I. Baldor and Ceasar X. Delgado, Miami, for appellees.
Before SALTER, LOGUE1 and LINDSEY JJ.
LB Judgment Holdings, LLC ("LB Judgment"),2 judgment creditor (as assignee from Ocean Bank) under a 2015 money judgment exceeding $ 10 million against Fountains 149, LLC, and Luis R. Boschetti ("Boschetti"), seeks review3 of a non-final order discharging notices of lis pendens filed against a group of impleaded companies in proceedings supplementary initiated to collect the judgment. LB Judgment contends that the impleaded entities held property (a) in which Boschetti had a property interest, or a debt or other obligation owed to him by, the impleaded companies, or (b) acquired by fraudulent transfer from Boschetti.
We have consolidated the three cases seeking review of related non-final orders:
For the reasons which follow, we reverse and vacate the order discharging the notices of lis pendens (Case No. 3D18-1190); we affirm the order sought to be appealed by several of the impleaded entities (Case No. 3D18-1323); and we affirm the bond order as to the seventeen properties owned by impleaded parties as well as the "Attorneys' Fees Bond," in the appeal and cross-appeal in Case No. 3D18-1726. As each of the three appeals has been taken from a non-final order, we vacate our temporary stay of the bond order, allowing full pretrial discovery and trial to ensue.
This appeal turns on a legal issue, and thus our review is de novo. Section 48.23, Florida Statutes (2018), governs notices of lis pendens and the prerequisites for filing them. Section 48.23(3) specifies that when, as here, the underlying lawsuit is not founded on a "duly recorded instrument" or a lien claimed under part I of chapter 713, Florida Statutes (governing construction liens), "the court shall control and discharge the recorded notice of lis pendens as the court would grant and dissolve injunctions."
Florida's courts have carefully prescribed the procedures to be followed by the trial courts in controlling and discharging a lis pendens in the cases that are not founded on a recorded instrument or construction lien. Trial courts and reviewing courts alike must balance (a) the lis pendens proponent's need to place non-parties on notice of the proponent's claims affecting the owner's real property, and (b) the damages that may be suffered by the owner (as third parties may turn away from the property because of the cloud of litigation) should the proponent's claims fail to prevail.
The balancing is achieved through two considerations: (1) is there a "fair nexus between the apparent legal or equitable ownership of the property and the dispute embodied in the lawsuit"? Chiusolo v. Kennedy, 614 So.2d 491, 492 (Fla. 1993) ; and (2) if there is such a nexus, what is the appropriate amount of a lis pendens bond to be required of the proponent, bearing "a reasonable relationship to the amount of damages which the property-holder defendant demonstrates will likely result if it is later determined that the notice of lis pendens was unjustified"? Med. Facilities Dev., Inc. v. Little Arch Creek Props., Inc., 675 So.2d 915, 918 n.2 (Fla. 1996).
"Fair nexus" is the issue we address in Case No. 3D18-1190, while lis pendens bond amounts are addressed here as part of Case No. 3D18-1726. Importantly, at the preliminary procedural point of a motion to dismiss the lis pendens before trial, the evaluation of "fair nexus" is not a trial or mini-trial on the merits of all elements of the lis pendens proponent's claims. Rather, Von Mitschke-Collande v. Kramer, 869 So.2d 1246, 1250 (Fla. 3d DCA 2004) (alteration in original) (quoting Chiusolo, 614 So.2d at 492 ).
In Acapulco Construction, Inc. v. Redavo Estates, Inc., 645 So.2d 182, 183 (Fla. 3d DCA 1994), this Court highlighted that distinction: "Clearly, it was not the plaintiffs' burden to establish their constructive trust claim by the greater weight of the evidence, but only to establish a ‘fair nexus’ between the apparent legal or equitable ownership of the subject property and the dispute involved in the instant lawsuit." We also observed that this requirement could be satisfied by a plaintiff through "an evidentiary showing of only a good faith, viable claim." Id.
In Regents Park Investments, LLC v. Bankers Lending Services, Inc., 197 So.3d 617, 621 (Fla. 3d DCA 2016), we provided additional guidance, observing that "it is impracticable to require a proponent of a lis pendens to fully prove each element of its claim in an evidentiary hearing where the case has not been noticed for trial and the parties may not even have completed discovery." We agreed with our sibling district court's holding in Nu-Vision, LLC v. Corporate Convenience, Inc., 965 So.2d 232, 236 (Fla. 5th DCA 2007), that the lis pendens proponent must make "a minimal showing that there is at least some basis for the underlying claim[ ] [a]nd ... show that he or she has a good faith basis to allege facts supporting a claim, and that the facts alleged would at least state a viable claim."
With these authorities in mind, we turn to the case at hand. LB Judgment's amended motion to commence proceedings supplementary includes allegations detailing its efforts to collect the $ 10,094,867.71 final judgment against Boschetti and Fountains 149, LLC, between entry of the judgment in February 2015 and the filing of the amended motion three years later. Those efforts culminated in nary a dime collected.
But those efforts and diligent investigation did ascertain that certain assets of Boschetti had been transferred to the control of his wife, his brother, and his brother's wife and daughter, through single-purpose entities controlled by them. At least some of the alleged transfers were pursuant to conveyances signed by Boschetti between the commencement of the underlying lawsuit and the entry of the final judgment sought to be collected, with multi-million dollar closing proceeds paid into a family-controlled entity. The supplemental complaint filed against the alleged alter ego entities claims that Boschetti transferred ownership in many of the entities to his wife, sister-in-law, and daughter-in-law "without receiving reasonably equivalent value, if any, in exchange," and that he transferred cash and capital to his spouse and the entities for the operation of the entities' real estate development business, concealing proceeds of the real estate activities from LB Judgment.
The supplemental complaint alleged two primary theories for direct claims against impleaded persons and entities. First, LB Judgment contended that certain entities were "alter ego entities"; that is, that Boschetti and his brother were "de facto owners" of those entities and controlled the disposition of assets that were, in whole or in part, Boschetti's property otherwise amenable to execution in connection with LB Judgment's unsatisfied judgment.
Second, LB Judgment alleged that Boschetti had engaged in fraudulent transfers of assets in order to avoid collection of LB Judgment's judgment, subject to avoidance under sections 726.105 and 726.106, Florida Statutes (2017).5 These statutes and the remaining provisions of chapter 726 define circumstances in which a transfer is fraudulent as to a creditor based on the actual intent of the transferor/debtor, or in which the debtor transfers assets or assumes obligations without receiving a "reasonably equivalent value in exchange." Section 726.108, "Remedies of creditors," permits a broad assortment of remedies to a creditor entitled to relief from fraudulent transfers, including avoidance of the transfer or obligation "to the extent necessary to satisfy the creditor's claim," attachment, injunctive relief, receivership, and "[a]ny other relief the circumstances may require."
LB Judgment's commencement of proceedings supplementary is authorized by section 56.29, Florida Statutes (2017...
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