Gershuny v. Gershuny
2015 Ohio 4454
Ohio Ct. App.2015Background
- David H. Gershuny was sole owner of Daily Planet Properties, Inc. (DPP), which owned a marital residence at 19 Diplomat Drive; Pamela and David lived there during their marriage though title remained in DPP.
- David and Pamela divorced in 2007; the decree left DPP and its assets (including 19 Diplomat Drive) with David/DPP, and David was ordered to pay child support; he failed to fully pay, and Pamela obtained a Missouri judgment for support.
- DPP faced foreclosure/tax delinquencies; in May 2008 David’s mother, Shirley, purchased the mortgage and paid tax delinquencies and other liens, averting sheriff’s sale.
- On December 30, 2008, DPP transferred the Diplomat Drive property to Shirley in exchange for forgiveness of DPP’s indebtedness to her, a life‑estate/rent‑free occupancy for David during Shirley’s life, and re‑title to David after Shirley’s death.
- Pamela sued under the Ohio Uniform Fraudulent Transfer Act (R.C. Chapter 1336), alleging the 2008 transfer was fraudulent as to her child‑support judgment; defendants moved for summary judgment, which the trial court granted.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether DPP should be treated as David’s "debtor" under the Ohio UFTRA (allowing reverse veil piercing) | Pamela: DPP was David’s alter ego; reverse pierce corporate veil so DPP assets satisfy David’s child‑support debt | Defendants: DPP is a separate corporate entity and was not indebted to Pamela; reverse piercing is not recognized in Ohio to hold corporations liable for personal debts | Court: David is the only UFTRA "debtor"; DPP is not indebted to Pamela, and Ohio does not adopt reverse veil piercing — no relief. |
| Whether Pamela had standing to challenge the transfer by DPP to Shirley under UFTRA | Pamela: As a child‑support creditor of David, she can set aside transfers that defeat collection of his obligations | Defendants: Pamela is creditor only of David, not of DPP; the transfer was by DPP (a non‑debtor as to Pamela) to Shirley | Court: Pamela lacks standing to assert UFTRA claims against DPP because DPP did not owe her a debt; summary judgment affirmed. |
Key Cases Cited
- Belvedere Condominium Unit Owners’ Assn. v. R.E. Roark Cos., 67 Ohio St.3d 274, 617 N.E.2d 1075 (1993) (discusses piercing the corporate veil standards)
- Cascade Energy & Metals Corp. v. Banks, 896 F.2d 1557 (10th Cir. 1990) (discusses reverse piercing and attachment of corporate assets)
- Winston v. Leak, 159 F. Supp. 2d 1012 (S.D. Ohio 2001) (noting Ohio has not adopted reverse corporate veil piercing)
- Carter‑Jones Lumber Co. v. Denune, 132 Ohio App.3d 430, 725 N.E.2d 330 (10th Dist. 1999) (creditor standing under Ohio UFTRA)