Allred v. Kennerley
This appeal is from a judgment following nearly 20 years of protracted and convoluted litigation arising out of a partnership agreement between Frederick Kennerley and Larry Allred to develop several lots in Danville, California. Over the course of the litigation there have been several bankruptcies, an action on a bond, an irrevocable trust, assignments of a number of claims and at least one divorce. Ultimately, the litigation boiled down to the disposition of proceeds from the sale of one of the lots: Lot 4. Allred, who had been charged with the responsibility of winding up the partnership, had used his own funds to purchase Lot 4 from the mortgage company. He then transferred title to himself, and subsequently transferred the property to his former wife, Shirley Allred. The superior court later ruled Allred had acted improperly in connection with those transfers. In a separate, derivative action, a different judge set aside the transfer to Shirley Allred. (Super. Ct. Contra Costa County, 1998, No. C96-04401.) In the end, the court in these proceedings ordered the sale of Lot 4, ordering further that the proceeds from the sale be distributed in the following manner: (1) $106,000 to Allred to repay him for the sum spent to prevent foreclosure on Lot 4, plus taxes and interest; (2) $175,383.36 to an irrevocable trust that had been established by Rebecca Kennerley (the Trust) as the owner of a judgment against the partnership; (3) $37,931.50 to the Trust on the theory that it had purchased Kennerleys right to attorney fees, and (4) $15,000 to the Trust on the theory it had obtained Kennerleys right to wages.
Allred appeals, contending, in part, the court erred by concluding he was not entitled to purchase Lot 4 for himself, and also by ruling additional sums owed to him could not be set off against the sums to be paid to the Trust. Allred also contends the court erred by refusing to allow him to introduce evidence that the $175,383.36 obligation to the Trust was owed by a entity other than the partnership. He contends the court erred by finding the judgment creating the debt had in fact been transferred to the Trust, arguing further the court should have allowed him to introduce evidence the Trusts attorney at one time had taken a position inconsistent with that finding. He contends the court erred by finding the Trust was entitled to the sum representing attorney fees. Finally, he contends the evidence does not support an implied finding Kennerley had transferred his right to attorney fees and wages to the Trust.
Court affirm.
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