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Canty v. Otto
304 Conn. 546
| Conn. | 2012
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Background

  • Canty, administratrix of Smith's estate, sought a prejudgment remedy against Otto and asserted a claim under the Uniform Fraudulent Transfer Act (UFTA).
  • Defendant Otto transferred assets to the defendant wife in 2007–2007 prior to a dissolution action and before criminal charges were filed, with little to no consideration.
  • A dissolution action was filed in April 2007; a lis pendens and various asset transfers followed, with the dissolution decree entered June 3, 2008, awarding most real property to Otto's wife.
  • The wrongful death action against Otto and the murder conviction followed; the trial court found probable cause that Otto acted with intent to defraud Smith's estate and that the transfers were fraudulent.
  • The trial court granted, then reduced, a prejudgment remedy against Otto; the defendant challenged standing, jurisdiction, and whether a dissolution decree could be collaterally attacked under the act.
  • The appellate court held that the plaintiff had standing under the act, that the dissolution was undertaken with actual intent to hinder, delay or defraud, and that the trial court had authority to grant practical relief without disturbing the dissolution judgment.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
Whether dissolution asset distributions are transfers under the act Canty asserts distributions are transfers under §52-552e. Otto contends distributions are not transfers but equitable divisions. Distributions are transfers under the act.
Whether the dissolution action was undertaken with actual intent to defraud Smith's estate Evidence supports intent to hinder/defraud under §52-552e(b) factors. No clear evidence of fraudulent intent; relies on defense testimony. Probable cause supported actual fraudulent intent.
Whether the court had jurisdiction to grant relief under the act without disturbing the dissolution decree Relief under the act is available to collaterally attack fraudulent transfers by a creditor not a party to the dissolution. Relief would impermissibly modify or collateral attack a dissolution judgment and disturb its mosaic. The court had jurisdiction to grant relief without disturbing the decree.
Whether plaintiff's status as a nonparty to the dissolution action bars her claim Nonparties may challenge fraudulent transfers under the act. Statutory provisions 46b-81/46b-86 apply to parties only and would bar relief. Plaintiff had standing as creditor; not barred by 46b-81/46b-86.

Key Cases Cited

  • Sweeney v. Sweeney, 271 Conn. 193 (2004) (subject-matter jurisdiction and final-judgment review principles)
  • State v. Curcio, 191 Conn. 27 (1983) (test for appealability; gray area of final judgments)
  • Solomon v. Keiser, 212 Conn. 741 (1989) (gray-area test for appealable interlocutory orders)
  • Monroe v. Horwitch, 215 Conn. 469 (1990) (statutory aggrievement and standing; plenary review of jurisdiction)
  • Maturo v. Maturo, 296 Conn. 80 (2010) (severability of financial orders in dissolution actions)
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Case Details

Case Name: Canty v. Otto
Court Name: Supreme Court of Connecticut
Date Published: May 1, 2012
Citation: 304 Conn. 546
Docket Number: 18610
Court Abbreviation: Conn.