Mira Overseas Consulting Ltd. v. Muse Family Enterprises, Ltd.

The question presented is: Does a judgment granting a fraudulent transfer claim, as well as monetary damages, relate back to the date on which the claimants recorded a lis pendens? We conclude that it does. Following a bench trial on reciprocal claims for declaratory relief regarding the priority of judgment liens, the trial court determined that the judgment lien of respondent Mira Overseas Consulting Ltd. (Mira) had priority over the judgment lein of appellants Muse Family Enterprises, Ltd. (the Muse Parties), because it was filed first. We reverse, finding that the Muse Parties’ judgment lien relates back to the date they recorded a lis pendens.

FACTUAL AND PROCEDURAL BACKGROUND

The Underlying Facts

The Muse Parties are 20 investor entities that made loans to BTM Funding, Inc. (BTM), a company wholly owned by David T. Smith (David). In 2008, David used BTM to purchase a residence in Pacific Palisades, California (the property), for approximately $10 million. David had BTM take title to the property to hide it from his former wife during their contentious divorce proceedings. David married respondent Carmen Copple Silva (Carmen), who is also trustee of the Carmen…