R. Promislow

The plaintiffs brought a motion for default judgment against their former investment advisor and his corporate entities for fraud and breach of fiduciary duty, and for summary judgment against the mutual fund dealer, FundEx, on the basis of vicarious liability.

The court granted default judgment against the advisor and his companies, finding the elements of civil fraud and breach of fiduciary duty were established based on deemed admissions.

However, the court dismissed the motion for summary judgment against FundEx, concluding that genuine issues requiring a trial existed regarding whether the advisor's wrongful acts were sufficiently connected to his authorized conduct to impose vicarious liability, and whether the plaintiffs' claims were discoverable outside the limitation period.

The plaintiffs brought a motion seeking orders authorizing a receiver to take possession of a residential property, evict occupants, and secure the property following findings of fraud in earlier proceedings.

A responding party brought cross-motions seeking a declaration that the property constituted a matrimonial home under the Family Law Act and requesting related relief to prevent enforcement against the property.

The court held that the transfer of the property to the responding party had already been determined at trial to be a fraudulent conveyance intended to defeat creditors, and that the responding party could not reopen factual issues after declining to testify or adduce evidence at trial.

The court further found that the responding party had consented to the mortgage transactions and that the Family Law Act did not protect the property from the plaintiffs’ tracing remedies arising from fraudulently obtained funds.

The motion was granted and the cross-motions were dismissed.