Consequential and Punitive Damages Available on Fraudulent Transfer Claim

In a recent case, the California Court of Appeal held that not only may a plaintiff recover the underlying debt or judgment on a common law fraudulent transfer claim but may additionally recover consequential and punitive damages from the defendant. (Berger v. Varum (2019) 35 Cal.App.5th 1013.) The court explained that, while the statutory fraudulent transfer claim under the California Uniform Voidable Transactions Act (UVTA) does not provide for such remedies, the UVTA is not the exclusive remedy. Therefore, where the plaintiff proves a common law fraudulent transfer against the defendant, the plaintiff may recover any damages caused by the fraudulent transfer. Likewise, the court held that punitive damages under Civil Code section 3294 may be available.