A constructive trust cause of action in California is the topic of this blog post.
A constructive trust cause of action in California is governed by Civil Code sections 2223 and 2224.
Civil Code section 2223 states that, “One who wrongfully detains a thing is an involuntary trustee thereof, for the benefit of the owner.”
Civil Code section 2224 states that, “One who gains a thing by fraud, accident, mistake, undue influence, the violation of a trust, or other wrongful act, is, unless he or she has some other and better right thereto, an involuntary trustee of the thing gained, for the benefit of the person who would otherwise have had it.”
Several published decisions from the California Courts of Appeal discuss a constructive trust cause of action in California.
“A cause of action for constructive trust is not based on the establishment of a trust, but consists of fraud, breach of fiduciary duty or other act which entitles the plaintiff to some relief. Relief, in a proper case, may be to make the defendant a constructive trustee with a duty to transfer to the plaintiff. Pleading requirements are: (1) facts constituting the underlying cause of action, and (2) specific identifiable property to which defendant has title.” Michaelian v. State Comp. Ins. Fund, (1996) 50 Cal. App. 4th 1093, 1114.
“Civil Code section 2223 and 2224 codify the equitable principle that one who wrongfully acquires property of another holds the property as an involuntary constructive trustee. The constructive trust extends to property acquired in exchange for that wrongfully acquired . . ., and includes ‘the direct product,’ i.e., profit on and enhancement in value of the property traced into the trust.” Haskel Engineering & Supply Co. v. Hartford Acc. & Indem. Co., (1978) 78 Cal. App. 3d 371, 374.
The statute of limitations for a constructive trust cause of action in California is based on the underlying substantive right. For example a constructive trust cause of action in California could be based on a common law fraudulent transfer cause of action and the California Supreme Court has stated that, “Since ‘[a] constructive trust is not a substantive device but merely a remedy to compel a person not justly entitled to property to transfer it to another who is entitled thereto’ an action seeking to establish a constructive trust is subject to the limitation period of the underlying substantive right.” Davies v. Krasna, (1975) 14 Cal. 3d 502, 515-16.
A constructive trust cause of action in California can also be combined with causes of action for common law fraudulent transfer and resulting trust. I recently drafted a complaint for an attorney in California which included a constructive trust cause of action as well as causes of action for common law fraudulent transfer and resulting trust.
Sample complaint with constructive trust cause of action in California for sale.
Attorneys or parties in California that would like to view a sample complaint containing a constructive trust cause of action in California as well as causes of action for common law fraudulent transfer and resulting trust including brief instructions and sample verification sold by the author can see below.
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The author of this blog post, Stan Burman, is an entrepreneur and retired litigation paralegal that worked in California and Federal litigation from January 1995 through September 2017 and has created over 300 sample legal documents for sale.
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Please note that the author of this blog post, Stan Burman is NOT an attorney and as such is unable to provide any specific legal advice. The author is NOT engaged in providing any legal, financial, or other professional services, and any information contained in this blog post is NOT intended to constitute legal advice.
The materials and information contained in this blog post have been prepared by Stan Burman for informational purposes only and are not legal advice. Transmission of the information contained in this blog post is not intended to create, and receipt does not constitute, any business relationship between the author and any readers. Readers should not act upon this information without seeking professional counsel.