Stephen Whittington v. Marc H. Nathan

The trial court properly granted summary judgment pursuant to the Fraudulent Transfer Act’s statute of repose. This Court’s reversal of summary judgment is an equitable outcome under the facts of this single case, but as the rule of law, it undermines the Fraudulent Transfer Act’s principle purpose of creating “uniformity” across the states and is contrary to the “absolute” nature of a statute of repose. To reach its holding, the Court had to read the phrase “the applicable statute of limitations” in section 16.064 of the Civil Practices and Remedies Code to mean “an applicable statute of limitations or repose”-language the Legislature could have adopted but did not. I therefore respectfully dissent.

Whittington’s Claim Was “Extinguished” by the Fraudulent Transfer Act’s Statute of Repose Section 24.010(a)(1) of the Fraudulent Transfer Act provides that certain Fraudulent Transfer Act claims are “extinguished” unless brought “within four years after the transfer was made or the obligation was incurred or, if later, within one year after the transfer or obligation was or could reasonably have been discovered by the claimant[.]” TEX. BUS. & COM. CODE ANN. § 24.010(a)(1) (West 2009). The parties agree that the statute of repose in section 24.010(a)(1) applies to Whittington’s claims against Nathan and that it bars Whittington’s claims unless the “ savings clause” in section 16.064(a) of the Civil Practice and Remedies Code (CPRC) tolls the running of the statute of repose. See TEX. CIV. PRAC. & REM. CODE ANN. § 16.064 (West 2008).