65 F.4th 1335
11th Cir.2023Background:
- SE Property Holdings (SEPH) obtained a >$19.6M deficiency judgment against Neverve after foreclosure.
- After the judgment, Neverve received settlement proceeds (BP proceeds) but transferred about $350,000 to attorneys for David Stewart (Neverve’s principal) to pay Stewart’s personal bankruptcy counsel.
- SEPH sued Neverve (and the Oklahoma attorneys), asserting FUFTA claims (actual and constructive fraud), seeking avoidance, compensatory and punitive damages, attorney’s fees, and an equitable lien.
- The district court dismissed claims against the Oklahoma attorneys for lack of personal jurisdiction; it granted summary judgment to Neverve, holding FUFTA’s catch‑all §726.108(1)(c)3. does not authorize money judgments against transferors, punitive damages, or attorney’s fees, and an equitable lien could not be imposed because Neverve did not possess the proceeds.
- SEPH appealed; the Eleventh Circuit, predicting how the Florida Supreme Court would rule (guided chiefly by Freeman), affirmed the district court.
Issues:
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether FUFTA’s catch‑all (§726.108(1)(c)3.) permits a money judgment against a transferor | FUFTA’s catch‑all allows “any other relief” — including a separate money judgment against the transferor | FUFTA limits money judgments to transferees under §726.109; catch‑all follows equitable remedies and cannot create a new cause of action against transferors | No — money judgment against transferor not available under FUFTA; affirmed |
| Whether punitive damages are recoverable under FUFTA | Catch‑all and §726.111 permit punitive damages for intentional fraud | FUFTA’s remedies are equitable in §726.108; punitive damages are legal, not equitable, and FUFTA contains no statutory authorization; Freeman favors narrow construction | No — punitive damages not authorized under FUTA’s catch‑all; affirmed |
| Whether attorney’s fees are recoverable under FUFTA | Catch‑all and §726.111 allow fee recovery | Florida law requires explicit statutory or contractual authorization for fees; FUFTA lacks express fee‑shifting and catch‑all is equitable only | No — attorney’s fees not recoverable under FUFTA; affirmed |
| Whether SEPH could obtain an equitable lien on the BP proceeds | FUFTA permits injunctions/equitable relief to prevent dissipation and impose a lien | Equitable lien requires the defendant to be in possession of the property; Neverve did not possess the proceeds; SEPH also waived new equitable arguments on appeal | No — equitable lien unavailable because Neverve lacked possession; affirmed |
Key Cases Cited
- Freeman v. First Union Nat’l Bank, 865 So. 2d 1272 (Fla. 2004) (Florida Supreme Court narrowly construes FUFTA’s catch‑all and refuses to create independent tort remedies against non‑transferees)
- Hansard Constr. Corp. v. Rite Aid of Fla., Inc., 783 So. 2d 307 (Fla. Dist. Ct. App. 2001) (pre‑Freeman appellate decision allowing money damages against transferor under FUFTA)
- McCalla v. E.C. Kenyon Constr. Co., 183 So. 3d 1192 (Fla. Dist. Ct. App. 2016) (followed Hansard to permit money damages against transferor)
- Alliant Tax Credit 31, Inc. v. Murphy, 924 F.3d 1134 (11th Cir. 2019) (interpreting Georgia UFTA to allow punitive damages under Georgia law)
- Isaiah v. JPMorgan Chase Bank, 960 F.3d 1296 (11th Cir. 2020) (explains FUFTA’s avoidance remedy—creditor may set aside fraudulent transfers to satisfy claim)
- Ault v. Lohr, 538 So. 2d 454 (Fla. 1989) (framework for punitive damages under Florida law—express finding of breach of duty supports punitive award)
- Price v. Tyler, 890 So. 2d 246 (Fla. 2004) (attorney’s fees are not recoverable absent statutory or contractual authorization)