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State v. Tucci

Superior Court of Maine, Cumberland

July 2, 2018

STATE OF MAINE, Plaintiff
v.
DANIEL B. TUCCI, SR, BEATRIX T. TUCCI, and MARCH 31, LLC, Defendants.

          ORDER

          Lance E. Walker, Justice Maine Superior Court

         Following this Court's June 13, 2018 Judgment and Order, Defendants filed this motion for amended/additional findings, amended/additional conclusions of law, and amended judgment. Plaintiff State of Maine has filed an opposition to this motion.

         I. Background

         On February 12 and 13, 2018, this Court presided over a bench trial in this matter. Thereafter the parties submitted extensive proposed findings of facts and conclusions of law. Following consideration of the evidence introduced at trial and the parties' proposed findings, this Court entered a Judgement and Order in the State's favor on June 13, 2018. Defendants timely filed this motion on June 19, 2018.

         II. Standard of Review

         Pursuant to MR. Civ. P. 52(b), the "court may. .. amend its findings or make additional findings and may amend the judgment if appropriate." However, the court need not grant every request. In re Jacob B., 2008 ME 168, ¶ 15, 959 A.2d 734. A motion made under M.R. Civ. P. 52(b) "must include the proposed findings of fact and conclusions of law requested." A motion under M.R. Civ. P. 59(e)[1] need not be granted "unless it is reasonably clear that prejudicial error has been committed or that substantial justice has not been done." Cotes v. Farrington, 423 A.2d 539, 541 (Me. 1980). "[W]hen the trial is before a judge without a jury, such motions must be based on a manifest error of law or mistake of fact. The burden of showing harmful error rests on the [moving] party." Id.

         III. Discussion

         A Rule 52(b) motion "should not be used to attempt to require the court to explain its reasoning in reaching a particular result or to reargue points that were contested at trial and have been resolved by the court's decision." Wandishin v. Wandishin, 2009 ME 73, ¶ 19, 976 A.2d 949. With this motion, Defendants are primarily attempting to reargue issues that have already been decided by the Court. Many of Defendants' proposed findings of fact submitted after trial, which are again proposed within this motion, were found to be irrelevant to the Court's decision or unsupported by the evidence. Similarly, Defendants request this Court to issue conclusions of law that the Court has already considered and rejected.

         Defendants do raise one issue that merits clarification: remedies. Defendants' motion concludes: "If this Court still determines that judgment should be entered for the Plaintiff, that judgment must be limited to no more than $39, 792 and can be satisfied by only one of the methods/remedies delineated at § 3578 and § 3579 of Title 14." (Defs.' Mot. 3.) The State concedes that clarification would be appropriate in order to acknowledge that under 14 M.R.S.A. § 3579, "the amount of damages and attorneys' fees recoverable from a transferee is generally limited to the value of the property transferred or the amount necessary to satisfy the State's claim, whichever is less." (Pl's Opp'n 10.) Defendants in turn seek an amended or additional finding that no monetary damages should be assessed against Beatrix Tucci as a transferee. (Defs.' Reply 1.) After considering the parties' arguments, the Court will clarify its conclusions of law as to remedies as follows.

         At the outset, the Court rejects Defendants' contention that the State must elect a single remedy under 14 M.R.S.A. § 3578. Although Defendants make no specific argument or cite any authority supporting their position, the Court presumes this theory arises from the presence of the word "or" at the end of subsection 3578(1)(B). While this use of the word "or" could indeed counsel in favor of finding that a plaintiff must elect a single remedy, the Court has located no authority mandating this interpretation of the statute. Our rules of construction of laws provide that "[t]he words 'and' and 'or' are convertible as the sense of a statute may require." 1 M.R.S.A. § 71(2); see also Office of the Revisor of Statutes, Maine Legislative Drafting Manual, pt. III, ch. 2, §11 (A) at 110-11 (1st ed. Oct. 1990, rev. Oct. 2016) ("'And' is conjunctive. If the legislative intent is that all requirements be fulfilled, the drafter should use 'and.' 'Or' is disjunctive. If the fulfillment of any one of several requirements is sufficient, use 'or.'") (emphasis added). Further, the statute's provision of "[a]ny other relief the circumstances may require" seems to grant the courts broad authority to fashion a remedy that suits the needs of the case. See 14 M.R.S.A. § 3578(1)(C)(4).

         Given the Law Court's holding in Samsara Mem'l Trust that attorney's fees are available as damages under section 3578(1)(C)(3), this Court finds no reason to limit the State's remedy to avoidance as provided by section 3578(1)(A), thereby denying attorney's fees available under section 3578(1)(C)(3). See Samsara Mem'l Trust v. Kelly, Remmel & Zimmerman, 2014 ME 107, ¶¶ 48-50, 102 A.3d 757. The Law Court's reasoning for awarding attorney's fees in Samsara Mem'l Trust is equally applicable to a plaintiff seeking avoidance of a fraudulent transfer as to a plaintiff seeking money damages. This Court also maintains that, in addition to avoidance of the transfer, an injunction preventing Defendants from further disposing of the property as provided by section 3578(1)(C)(1) is necessary in light of the fact that this property was at one point listed for sale.

         Although the Court's June 13 Judgment makes no mention of any remedy granted under section 3579, because both parties have raised the issue in their post-judgment filings, the Court will expressly clarify that no remedy is granted under section 3579. Section 3579(2) "provides that a defrauded creditor can recover a monetary judgment against the transferee of the fraudulently conveyed property in lieu of avoiding the transfer." 14 M.R.S.A. § 3579, Maine Comment 2. Because the Court has awarded avoidance of the transfer, an additional award of money damages against any transferee (i.e., Beatrix Tucci or March 31, LLC) would be improper.

         Finally, Defendants argue that any judgment awarded to the State should be limited in value to $39, 792. Section 3578 provides that avoidance of the transfer is available "to the extent necessary to satisfy the creditor's claim." 14 M.R.S.A. § 3578(1)(A). The State's underlying claim is the amount of the 2013 UTPA judgment. That judgment ordered Tucci to pay $236, 500.50 in restitution and $140, 000.00 in civil penalties. Because the value of Tucci's interest in 104 Monument Street at the time of transfer ($81, 000.00) is less than the amount of the State's underlying claim against Tucci, avoidance of the entire transfer is proper.

         Defendants' argument, also raised in their proposed findings of fact and conclusions of law, is that the value of the judgment should be reduced because the transfer was not made with intent to defraud the Ashley and Flaherty families, who were granted a total of $196, 708.50 in restitution in the UTPA judgment. Even if this allegation is accepted as fact, the Court finds it is irrelevant. Following the reasoning of the U.S. District Court for the District of Massachusetts, the UFTA permits creditors to seek avoidance of a transfer that was made with the intent to defraud, regardless of "whether the creditor's claim arose before or after the transfer was made" so long as the transfer was made to "defraud any creditor." Id., § 3575(1)(A); Norwood Coop. Bank v. Gibbs, No. 10-11647-JCB, 2012 U.S. Dist. LEXIS 131404, at *22-23 (D. Mass. Sept. 13, 2012) (emphasis added). Because this Court finds the transfer of 104 Monument Street was made with ...


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