CACI No. 4208. Affirmative Defense - Statute of Limitations - Actual and Constructive Fraud (Civ. Code, § 3439.09(a), (b))

Judicial Council of California Civil Jury Instructions (2020 edition)

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4208.Affirmative Defense - Statute of Limitations - Actual and
Constructive Fraud (Civ. Code, § 3439.09(a), (b))
[Name of defendant] contends that [name of plaintiff]’s lawsuit was not
filed within the time set by law.
[[With respect to [name of plaintiff]’s claim of actual intent to hinder,
delay, or defraud,] [To/to] succeed on this defense, [name of defendant]
must prove that [name of plaintiff] filed [his/her/nonbinary pronoun/its]
lawsuit later than four years after the [transfer was made/obligation was
incurred] [or, if later than four years, no later than one year after the
[transfer/obligation] was or could reasonably have been discovered by
[name of plaintiff]].
[[With respect to [name of plaintiff]’s claim of constructive fraud,] [To/to]
succeed on this defense, [name of defendant] must prove that [name of
plaintiff] filed [his/her/nonbinary pronoun/its] lawsuit later than four years
after the [transfer was made/obligation was incurred].]
New June 2006; Revised December 2007, June 2016, May 2018
Directions for Use
This instruction provides an affirmative defense for failure to file within the statute
of limitations. (See Civ. Code, § 3439.09(a), (b).) Read the first bracketed paragraph
regarding delayed discovery in cases involving actual intent to hinder, delay, or
defraud. (See Civ. Code, § 3439.04(a)(1); CACI No. 4200.) Read the second in
cases involving constructive fraud. (See Civ. Code, §§ 3439.04(a)(2), 3439.05; CACI
Nos. 4202, 4203.) Read the first bracketed phrases in those paragraphs if the
plaintiff has brought both actual and constructive fraud claims.
This instruction may not be modified to assert the seven-year period under Civil
Code section 3439.09(c). (See PGA West Residential Assn., Inc. v. Hulven Internat.,
Inc. (2017) 14 Cal.App.5th 156, 178-185 [221 Cal.Rptr.3d 353] [Civil Code section
3439.09(c) is a statute of repose, not a statute of limitations].)
Sources and Authority
• Statute of Limitations. Civil Code section 3439.09(a), (b).
• Statute of Repose. Civil Code section 3439.09(c).
• “[T]he UFTA is not the exclusive remedy by which fraudulent conveyances and
transfers may be attacked. They may also be attacked by, as it were, a common
law action. If and as such an action is brought, the applicable statute of
limitations is section 338 (d) and, more importantly, the cause of action accrues
not when the fraudulent transfer occurs but when the judgment against the
debtor is secured (or maybe even later, depending upon the belated discovery
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issue).” (Macedo v. Bosio (2001) 86 Cal.App.4th 1044, 1051 [104 Cal.Rptr.2d
1].)
• “In the context of the scheme of law of which section 3934.09 is a part, where
an alleged fraudulent transfer occurs while an action seeking to establish the
underlying liability is pending, and where a judgment establishing the liability
later becomes final, we construe the four-year limitation period, i.e., the
language, ‘four years after the transfer was made or the obligation was incurred,’
to accommodate a tolling until the underlying liability becomes fixed by a final
judgment.” (Cortez v. Vogt (1997) 52 Cal.App.4th 917, 920 [60 Cal.Rptr.2d
841].)
• “ ‘Cal. Civ. Code § 3439.09(a) and (b) are statutes of limitation requiring a
plaintiff to file a fraudulent transfer action within four years of the transfer or,
for an intentional fraud, within one year after the transfer was or could
reasonably have been discovered.’ [Citation]” (PGA West Residential Assn., Inc.,
supra, 14 Cal.App.5th at p. 179.)
• “However, ‘even if belated discovery can be pleaded and proven’ with respect to
the statute of limitations applicable to common law remedies for fraudulent
transfers, ‘in any event the maximum elapsed time for a suit under either the
UFTA or otherwise is seven years after the transfer. [Citation.]’ This conclusion
logically follows from the language of section 3439.09(c). ‘[B]y its use of the
term “[n]otwithstanding any other provision of law,” the Legislature clearly
meant to provide an overarching, all-embracing maximum time period to attack a
fraudulent transfer, no matter whether brought under the UFTA or otherwise.’ ”
(PGA West Residential Assn., Inc.,supra, 14 Cal.App.5th at pp. 170-171,
original italics, internal citation omitted.)
Secondary Sources
Ahart, California Practice Guide: Enforcing Judgments & Debts, Ch. 3-C,
Prejudgment Collection - Prelawsuit Considerations, ¶ 3:351 et seq. (The Rutter
Group)
23 California Forms of Pleading and Practice, Ch. 270, Fraudulent Conveyances,
§§ 270.49, 270.50 (Matthew Bender)
4209-4299. Reserved for Future Use
CACI No. 4208 UNIFORM VOIDABLE TRANSACTIONS ACT
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