WILLIAM F. MCGONAGLE, III and KAREN E. BARSTOW, Plaintiffs
WILLIAM PALLI, JR, and DIVINE MERCY, LLC, Defendants
ORDER ON MOTION FOR PARTIAL SUMMARY JUDGMENT
Nancy Mills, Justice, Superior Court.
Before the court is defendant William Palli, Jr's motion for partial summary judgment on the following counts of the plaintiffs' complaint: count II, trespass; count VI, declaratory judgment; and count VII, fraudulent transfer. In his reply memorandum, defendant Palli focuses only on count VII and whether defendant Divine Mercy should be dismissed from count VI. For the following reasons, the motion is denied.
Plaintiffs own two lots located at 138 Ledge Road in Yarmouth, Maine. (Def.'s Supp. S.M.F. ¶ 1.) Defendant Palli owns adjacent land benefitted by an easement appurtenant across a portion of plaintiffs' property. (Def.'s Supp. S.M.F. ¶ 2.) Plaintiffs filed a previous lawsuit on January 30, 2012, which involved defendant Palli's easement (Def.'s Supp. S.M.F. 1 3.) That case settled in July 2012 and plaintiffs' complaint was dismissed with prejudice. (Def.'s Supp. S.M.F. ¶¶ 4-5.)
In September 2012, defendant Palli filed a Certificate of Formation with the Secretary of State to form Divine Mercy, LLC (Divine Mercy). (Def.'s Supp. S.M.F. ¶ 6.) Defendant Palli is the sole principal of the entity. (Def.'s Supp. S.M.F. ¶ 6.) On October 18, 2012, plaintiffs' counsel sent a letter to defendant Palli's attorney requesting that defendant comply with certain provisions of the parties' settlement agreement. (Def.'s Supp. S.M.F. ¶ 9; Pis.' A.S.M.F. ¶ 12.) The following day, defendant Palli's counsel sent a letter to the Town of Yarmouth's attorney to inform the Town that defendant Palli would be transferring a portion of his Ledge Road property to Divine Mercy. (Def.'s Supp. S.M.F. ¶ 10.) On the same day, 10/19/12, defendant Palli transferred the property for no consideration to defendant Divine Mercy by deed, which is recorded at book 30041, page 224 in the Cumberland County Registry of Deeds. (Def.'s Supp. S.M.F. OT 12, 15.) This transfer created two lots, one owned by defendant Palli and one owned by defendant Divine Mercy, both of which were intended to be benefitted by the easement across plaintiffs' property. (Def.'s Supp. S.M.F. ¶ 11.)
After plaintiffs filed suit, defendant Divine Mercy conveyed the Ledge Road land back to defendant Palli on January 24, 2013. (Def.'s Supp. S.M.F. ¶ 27.) These two deeds contain language that differs from the easement language in the original deed to defendant Palli. (Pis.' Opp. S.M.F. ¶ 20.) On February 14, 2013, defendant Divine Mercy was cancelled and a Certificate of Cancellation was filed with the Secretary of State. (Def.'s Supp. S.M.F. ¶ 29.)
Plaintiffs filed their complaint on 11/9/12. On 11/26/12, plaintiffs filed a motion for attachment, which the court denied on 2/5/13. On 4/4/13, defendants filed this motion for partial summary judgment on counts II, VI, and VII of the complaint. In his reply memorandum, defendant Palli does not press the motion as to count VI and concedes there are genuine issues of material fact regarding count II of the complaint. (Def.'s Reply Mem. 1.) Accordingly, the court considers count VII only and whether defendant Divine Mercy should be dismissed from count
1. Standard of Review
"Summary judgment is appropriate when there is no genuine issue of material fact that is in dispute and, at trial, the parties would be entitled to judgment as a matter of law." Fitzgerald v. Hutchins, 2009 ME 115, ¶ 9, 983 A.2d 382 (citing Dyer v. Dep't of Transp., 2008 ME 106, ¶ 14, 951 A.2d 821). "An issue is genuine if there is sufficient evidence supporting the claimed factual dispute to require a choice between the differing versions; an issue is material if it could potentially affect the outcome of the matter." Brown Dev. Corp. v. Hemond, 2008 ME 146, ¶10, 956 A.2d 104 (citing Univ. of Me. Found, v. Fleet Bank of Me., 2003 ME 20, ¶ 20, 817 A.2d 871). Disputes of material fact "must be resolved through fact-finding, even though the nonmoving party's likelihood of success is small." Curtis v. Porter, 2001 ME 158, ¶ 7, 784 A.2d 18 (citing Niehoff v. Shankman & Assocs. Legal Or., P.A., 2000 ME 214, ¶ 10, 763 A.2d 121, 124-25).
2. Fraudulent Transfer
Plaintiffs allege that defendant Palli's transfer of land to defendant Divine Mercy was intended to "hinder and delay" plaintiffs in collecting a judgment. (Compl. ¶ 88.) Under Maine's version of the Uniform Fraudulent Transfer Act,
A transfer made or obligation incurred by a debtor is fraudulent as to a creditor, whether the creditor's claim arose before or after the transfer was made or the obligation was incurred, if the ...