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Biliouris v. Patman

United States District Court, N.D. Texas, Dallas Division

March 21, 2017

TIMOTHY L. BILIOURIS, et al ., Plaintiffs,



         Before the Court is Defendants' Motion to Dismiss for Failure to State a Claim (ECF No. 4). For the reasons stated below, the Motion is GRANTED IN PART and DENIED IN PART.

         I. BACKGROUND

         On May 31, 2016, Plaintiffs filed their Complaint alleging that Defendants violated the Texas Uniform Fraudulent Transfer Act (“TUFTA”), to avoid paying a judgment against them arising from a suit by these Plaintiffs for breach of contract, fraud, negligent misrepresentation, unjust enrichment, civil conspiracy, aiding and abetting, and a violation of the Texas Securities Act (“the underlying case”).[1] On August 11, 2010, following a jury trial, another judge on this Court entered an Amended Final Judgment[2] in favor of the Plaintiffs against Defendant David Pat Patman (“Pat”), for in excess of $8, 000, 000.[3]

         Plaintiffs claim that in 2008, Pat and Beverly Ann Patman, (“Beverly”) gave a gift of a real estate parcel, valued at $400, 000, to their son David Caine Patman (“David”), but that Plaintiffs did not know about the transfer until they learned of it in Beverly's post-judgment deposition on August 26, 2015.[4] Plaintiffs further claim that Pat made a gift of a 1956 Chevrolet to David, in March 2009, two months before the jury trial began in the underlying case. Plaintiffs contend they did not know about this gift until May 30, 2015. Plaintiffs also claim that in Beverly's post-judgment deposition, they discovered that in 2010, after the judgment in the underlying case was entered, Pat and Beverly made additional gifts to David, including paying for a portion of his wedding expenses and honeymoon trip.

         Plaintiffs allege TUFTA §§ 24.005(a)(1), 24.005(a)(2)(B), and 24.006(a) were violated when Pat and Beverly made the three transfers to David between 2008 and 2010. Section 24.005(a)(1) provides that a debtor's transfer is “fraudulent as to the creditor, ” if the debtor made the transfer “with an actual intent to hinder, delay, or defraud any creditor of the debtor.”[5]Section 24.005(a)(2)(B) provides that a transfer is fraudulent if the debtor did not receive a “reasonably equivalent value in exchange for the transfer, and the debtor…intended to incur, or believed or reasonably should have believed that the debtor would incur debts beyond the debtor's ability to pay as they became due.”[6] Section 24.006(a) provides that a transfer by a debtor is “fraudulent as to the creditor whose claim arose before the transfer was made” if the debtor made the transfer “without receiving equivalent value in exchange for the transfer…and the debtor was insolvent at that time or the debtor became insolvent as a result of the transfer.”[7]

         Defendants have moved to dismiss under Rule 12(b)(6), asserting that Plaintiffs' claims have been extinguished under TUFTA's statute of repose, codified at § 24.010. Fed.R.Civ.P. 12(b)(6).


         To survive a Rule 12(b)(6) motion to dismiss, a pleading must contain “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). The pleading standard in Rule 8 does not require “detailed factual allegations, ” but it does demand more than an unadorned accusation devoid of factual support. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face. Twombly, 550 U.S. at 570. A claim may also be dismissed if a successful affirmative defense appears clearly on the face of the pleadings. Clark v. Amoco Prod. Co., 794 F.2d 967, 970 (5th Cir. 1986).

         III. ANALYSIS

         A. Transfers Under TUFTA § 24.005(a)(1)

         Defendants assert that the statute of repose bars Plaintiffs' claims as a matter of law. The statute of repose extinguishes § 24.005(a)(1) claims unless they were brought within four years of the date when the transfer was made or, if later, within one year after the transfer was or could reasonably have been discovered by the Plaintiffs.[8]

         1. Real Property

         The real estate transfer of which the Plaintiffs complain occurred in 2008, but Plaintiffs filed this suit in 2016. Plaintiffs claim they first learned on August 26, 2015, that Pat and Beverly made the transfer. The only way the statute of repose does not bar Plaintiffs' claim that the real estate was fraudulently transferred is the discovery rule, but that rule “does not apply to claims that could have been discovered through the exercise of reasonable diligence.” Kerlin v. Sauceda, 263 S.W.3d 920, 925 (Tex. 2008). The Court takes judicial notice of the filing on January 25, 2008, of the Warranty Deed from Pat and Beverly to David in the real estate records maintained by the Johnson County Clerk. The deed was recorded on April 3, 2008. A certified copy is attached to Defendants' Motion to Dismiss.[9] Under Texas law, “[a]n instrument that is properly recorded in the proper county is 1) notice to all persons of the existence of the instrument; and 2) subject to inspection by the public.”[10] Further, the “filing of an instrument is notice to all persons.” Alkas v. United Sav. Ass'n of Tex. Inc., 672 S.W.2d 852, 856 (Tex. App.- Corpus Christi 1984, writ ref'd n.r.e.). Real ...

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