On October 30, 2019, the Second Department issued a decision in Galasso, Langione & Botter, LLP v. Galasso, 2019 NY Slip Op. 07769, upholding the imposition of a constructive trust, explaining:
We agree with the Supreme Court’s determination to grant that branch of the Barons’ motion which was for summary judgment on the eighth cause of action in Action No. 4, seeking the imposition of a constructive trust, insofar as asserted against GC Lawcondo, and to deny that branch of the motion of the moving defendants which was for summary judgment dismissing that cause of action insofar as asserted against GC Lawcondo. A constructive trust is the formula through which the conscience of equity finds expression. When property has been acquired in such circumstances that the holder of the legal title may not in good conscience retain the beneficial interest, equity converts him into a trustee. The elements of a constructive trust are: (1) a confidential or fiduciary relationship, (2) an express or implied promise, (3) a transfer in reliance thereon, and (4) unjust enrichment flowing from the breach of the promise. However, these elements serve only as a guideline, and a constructive trust may still be imposed even if all of the elements are not established. Here, the Barons demonstrated their prima facie entitlement to the remedy of a constructive trust by showing that escrow funds entrusted to Peter were used by GC Lawcondo, an entity wholly owned and controlled by the Firm, to purchase a commercial office condominium to be used as a law office. The moving defendants failed to raise a triable issue of fact in opposition.
(Internal quotations and citations omitted).
We have substantial experience in helping judgment creditors collect on judgments and search for and attach assets worldwide. This decision discusses one tool to help a judgment creditor collect on a judgment: the imposition of a constructive trust over the proceeds of wrongly-transferred funds. Contact Schlam Stone & Dolan partner John Lundin at email@example.com if you or a client need help collecting on a judgment.
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