Blake v. Rozowicz

Creditors' and Debtors' Rights

New York Law Journal

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Judge David Hurd

Rozowicz owned the Condor firms, which owned car dealerships in Catskill, New York and Great Barrington, Massachusetts. Rozowicz owned the land for the Catskill dealership. Blake claimed Condor owned its equipment. After contracts to be the dealerships' manager were terminated, Rozowicz sold the Catskill dealership to Romeo for $600,000. Under a Nov. 11, 2005, agreement Romeo leased the dealership's property, building and equipment for five years at $14,500 monthly. The Great Barrington dealership ceased operation in 2006. Condor defaulted in Blake's contract breach action. A state court awarded Blake $144,810 against Condor which dissolved in December 2008. District court granted Blake partial judgment in his suit claiming Rozowicz's fraudulent transfer of assets prevented Condor's payment of the $144,810 award. Record evidence showed that Rozowicz received no proceeds from the sale of the Catskill dealership. However, it was clear that $18,128 Rozowicz received in November 2005 constituted an unlawful preferential loan repayment to Condor's sole shareholder and president. Similarly the transfer of the ownership or rental value of the Catskill dealership's equipment from Condor to Rozowicz was a fraudulent conveyance.

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