Cheung

The issue presented is whether a jury can award exemplary damages when it has expressly determined that the plaintiffs were entitled to “0.00” compensatory damages. Our answer is No.

Background

The latest episode in a bitter and protracted dispute concerning a rundown residential property under the control of Ron Daley was a complaint in which neighbors to the property alleged that Daley had, in violation of the Uniform Fraudulent Transfer Act (Civ. Code, § 3439 et seq.), conveyed his interest in the parcel and another property to his mother in order to evade satisfying a nuisance judgment about to be obtained by the neighbors. Among the various forms of relief sought by the neighbors were compensatory and exemplary damages.

The case was tried to a jury. With respect to the issue of compensatory damages, plaintiffs argued that they should recover the approximately $44,000 of costs and unbilled attorney fees incurred in prosecuting the now completed nuisance action. The jury by special verdict found that “the total amount of compensatory damages to which all Plaintiffs are entitled” was “0.00.” The jury further found that “in making the transfers of [the two properties]…