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A. Roeckl and Fermell Co. v. FDIC (12/2/94), 885 P 2d 1067
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Notice: This opinion is subject to formal correction
before publication in the Pacific Reporter. Readers
are requested to bring errors to the attention of the
Clerk of the Appellate Courts, 303 K Street, Anchorage,
Alaska 99501.
THE SUPREME COURT OF THE STATE OF ALASKA
ANTON ROECKL, individually, )
and d/b/a FERMELL COMPANY, )
) Supreme Court No. S-5622
Appellant, )
) Superior Court No.
v. ) 3AN-89-334 CI
)
FEDERAL DEPOSIT INSURANCE )
CORPORATION, in its )
corporate capacity, ) O P I N I O N
)
Appellee. ) [No. 4154 - December 2, 1994]
______________________________)
Appeal from the Superior Court of the
State of Alaska, Third Judicial District,
Anchorage,
J. Justin Ripley,
Judge.
Appearances: William L. Choquette,
Artus & Choquette, P.C., Anchorage, for
Appellant. Robert C. Auth, Staff Attorney,
Anchorage, Ann S. DuRoss Assistant General
Counsel, Richard J. Osterman, Jr., Senior
Counsel, and E. Whitney Drake, Special
Counsel, Washington, D.C., for Appellee.
Before: Moore, Chief Justice,
Rabinowitz, Matthews and Compton, Justices,
and Bryner, Justice, pro tem.*
BRYNER, Justice, pro tem.
This appeal by Anton Roeckl from the superior court's
order of summary judgment in favor of the Federal Deposit
Insurance Corporation (FDIC) requires us to determine whether a
conveyance of real property to a grantee under an assumed
business name is barred under Alaska law. We conclude that such
a conveyance is permissible in the absence of actual fraud, and,
accordingly, we reverse the summary judgment entered below.
I. STATEMENT OF FACTS
A. Judgments against Ferche and Ferche's conveyances
to Fermell Company
On January 14, 1985, Ludwig Ferche executed and
delivered a promissory note for $350,000.00 to Alaska Mutual
Bank. On June 19, 1985, Ferche modified and increased the note
to $1,000,000.00. On March 10, 1986, Ferche executed and
delivered to United Bank Alaska a collateral note for
$200,000.00. When the notes matured on July 1, 1986, the banks
demanded payment, but Ferche defaulted. At the time,
Ferche owned three parcels of undeveloped land in or near
Anchorage. On November 6, 1986, Ferche executed warranty deeds
conveying two of the parcels to a grantee whom the deeds
identified as "Fermell Company, Post. F. 20.05.25, 8000 Munchen
2, West Germany, a foreign business organization." The name
"Fermell Company"was not registered under the laws of Alaska or
the Federal Republic of Germany.
On April, 9, 1987, United Bank Alaska sued Ferche for
the amount due on the March 10, 1986 collateral note. On April
27, 1988, while the lawsuit was pending, Ferche conveyed his
third parcel of land to Fermell Company. During the course of
this litigation, United Bank Alaska and Alaska Mutual Bank merged
to form Alliance Bank. On May 20, 1988, Alliance Bank, as
successor by merger, obtained judgment against Ferche for
approximately $260,295.00 plus interest.
On January 13, 1989, Alliance Bank filed a second
lawsuit against Ferche for the amount due on the promissory note
of January 14, 1985, and the modification agreement of June 19,
1985. The Director of Banking for Alaska subsequently closed
Alliance Bank and appointed FDIC receiver pursuant to AS
06.05.470(d), (z). On August 28, 1991, FDIC, as successor of
Alliance Bank, obtained judgment against Ferche on the second
suit for $1,100,000.00 plus interest.1
B. Litigation to set aside Ferche's conveyances to
Fermell Company
In January 1989, Alliance Bank filed an action against
Ferche individually and d/b/a Fermell Company, alleging that
Fermell Company was a non-existent entity and that Ferche's
initial conveyance to Fermell amounted to a sham transfer to
avoid the lien created by the May 20, 1988 judgment that had been
entered against Ferche as a result of his failure to pay on the
collateral note.
Ferche did not answer the complaint, but Fermell
Company did. Its answer alleged that Fermell Company was a group
of investors headed by Anton Roeckl of Munich, Germany. The
answer further claimed that Fermell Company was the bona fide
owner of the disputed property and denied that the transfer to it
from Ferche had been a fraud or sham.
FDIC, as Alliance Bank's successor, later filed
amended complaints seeking to set aside all three of the
conveyances that Ferche had made to Fermell Company. The amended
complaints reiterated the fraudulent transfer claim against
Ferche and asserted that "Fermell Company is not an entity in
which title to real property in Alaska may vest." Roeckl, on
behalf of Fermell Company, filed an answer denying these
allegations and claiming to be the owner of the three parcels of
land in his capacity as owner of Fermell Company. Roeckl
counterclaimed against FDIC alleging that he had transferred
valuable consideration for the title to the property. He further
asserted that if the deeds were declared void, he was entitled to
an equitable and legal lien against the property for all sums
paid to Ferche. In addition, Roeckl cross-claimed against Ferche
for damages in the event the deeds were declared void.
FDIC eventually moved for partial summary judgment,
requesting the superior court to determine that Fermell Company
was not a legal entity capable of receiving title to the disputed
properties and to declare Ferche's deeds to Fermell Company void
on that basis. Roeckl opposed, arguing that his use of the
assumed business name "Fermell Company"to take title of the
property had not been improper. Superior Court Judge J. Justin
Ripley granted FDIC's partial summary judgment motion, finding
that Ferche's warranty deeds to Fermell Company were void, and
thus, the title remained vested in Ferche. The court concluded
that FDIC's judgment against Ferche "attach[ed] to said real
property as a first lien thereon."
Relying on the partial summary judgment order, Judge
Ripley later concluded that no trial would be necessary on FDIC's
claim that Ferche's conveyances to Fermell Company had been
fraudulent. Without reaching the question of fraud, Judge Ripley
entered final judgment in favor of FDIC and against Roeckl and
Fermell Company.
After unsuccessfully seeking reconsideration by the
superior court, Roeckl filed this appeal.
II. DISCUSSION
A. Standard of Review
In reviewing a grant of summary judgment, this court
must independently determine whether there are any genuine issues
of material fact and whether the moving party is entitled to
judgment as a matter of law. Korman v. Mallin, 858 P.2d 1145,
1148 (Alaska 1993); Alaska R. Civ. P. 56(c). We must draw all
reasonable inferences in favor of the nonmoving party and against
the movant. Korman, 858 P.2d at 1148.
B. Whether the Superior Court Erred in Granting
FDIC's Motion for Partial Summary Judgment?
1. Arguments on Appeal
In the present case, Ferche executed three deeds to
"Grantee, FERMELL COMPANY, POST F. 20.05.25, 8000 Munchen 2, West
Germany, a foreign business organization." FDIC sought to set
the transactions aside as fraudulent and also asserted that
Fermell Company was a fictitious entity. Anton Roeckl
intervened, denying fraud and claiming that Fermell Company was
his assumed business name. In moving for partial summary
judgment, FDIC maintained that the deeds to Fermell Company were
invalid because Fermell Company was a fictitious entity and was
not legally capable of holding title.
FDIC's partial summary judgment motion did not raise
the underlying contention that the conveyances from Ferche to
Fermell Company should be set aside as fraudulent. In granting
summary judgment, the superior court did not purport to address
the issue of fraud; it simply found the deeds void for lack of a
valid grantee. In so doing, the court rejected Roeckl's claim to
be the actual grantee as owner of Fermell, concluding that
Fermell was not capable of receiving title because it was a
fictitious entity.2
On appeal, Roeckl maintains that he was not legally
barred from using an assumed business name for the purpose of
taking title from Ferche. He argues that the superior court
erred in concluding that Fermell was not a legal entity capable
of receiving title from Ferche. He asserts that a genuine issue
of material fact exists as to "the concurrence of identity
between Anton Roeckl and Fermell Company."
In response, FDIC cites the common law rule that a deed
must designate a grantee who is legally capable of taking title
at the time of the conveyance. FDIC argues that Roeckl should
not be permitted to claim title to the parcels under the name
Fermell Company because that company is a fictitious entity that
did not exist prior to the land transfers. In FDIC's view, the
record clearly shows that Fermell Company was a fictitious name
rather than a properly assumed business name. FDIC claims that
"[t]he undisputed facts in this case show that Anton Roeckl has
never been known as, or previously used the name, Fermell Company
prior to these attempted conveyances." Additionally, noting that
Fermell Company was not incorporated or registered as a business
in Alaska or Germany, FDIC argues that public policy should bar
any person or business from claiming title under an assumed name
unless the name has been formally registered.
As framed in the parties' briefs, Roeckl's challenge to
the superior court's summary judgment order requires us to
consider three related issues: first, whether conveyances to
grantees under fictitious or assumed names are generally allowed;
second, whether a genuine issue of fact exists as to Roeckl's
claim that Fermell Company was an assumed name under which he did
business rather than a fictitious entity; and, third, whether
Roeckl was barred from taking title under an assumed name that he
had not formally registered. We consider each issue in turn.
2. Are conveyances to grantees under
assumed names generally allowed?
As correctly noted by FDIC, a deed to a fictitious
grantee is void: "Because the underlying transaction requires
both a grantor and a grantee and the deed must identify them in
some way, a deed to a grantee who is not a living person or an
existing entity is void." R.G. Natelson, Modern Law of Deeds to
Real Property, 5.1 at 108-09 (footnote omitted); see also
Moffat v. United States, 112 U.S. 24, 31 (1884) ("[A] patent to a
fictitious person is, in legal effect, no more than a declaration
that the government thereby conveys the property to no one.");
Oregon v. Bureau of Land Management, 876 F.2d 1419, 1425 (9th
Cir. 1989) ("[T]here is a general rule of property law that a
deed made out to a fictitious person is void, while a deed made
out to a real person, even if obtained by fraud, is only
voidable.").
The particular manner in which the deed names the
grantee is not critical, however: the grantee need only be "so
designated and described as to distinguish him [or her] from the
rest of the world." 6 George W. Thompson, Commentaries on the
Modern Law of Real Property 3006, at 349 (John S. Grimes repl.
ed. 1962). In the event of ambiguity, "[p]arol evidence is
admissible to identify the grantee, and a deed is sufficient if
the grantee can be identified by extrinsic evidence." Id. at
352. In this regard, "all our law requires is that the grantee
be described in such terms that by reference to objective
evidence otherwise available, his identity may be ascertained
with reasonable certainty." Garroway v. Yonce, 549 So. 2d 1341,
1342 (Miss. 1989).
Moreover, the law has traditionally distinguished
between conveyances to nonexistent or wholly fictitious grantees
and conveyances to persons or businesses operating under assumed
names:
[T]he sometimes stated "general rule"
that a deed which names a fictitious person
as grantee is void is based on the physical
nonexistence of any grantee. However, care
must always be taken to distinguish between a
deed to a nonexistent being and a deed to a
person in existence who is described by an
assumed, fictitious, trade, or inaccurate
name.
Thomas v. City of Columbus, 528 N.E.2d 1274, 1276-77 (Ohio App.
1987); see also Marky Inv., Inc. v. Arnezeder, 112 N.W.2d 211,
216-17 (Wis. 1961).
Thus, while recognizing that "[a] conveyance . . . to
an absolutely fictitious person is a nullity,"Tiffany observes
that "[i]t does not affect the validity of the conveyance that
the name of the grantee . . . is not that ordinarily borne by
him, but one given to or assumed by him for the occasion is
sufficient." 4 Herbert T. Tiffany, The Law of Real Property
967, at 42 (3d ed. 1975) (footnotes omitted).3
Because these authorities make it clear that transfers
to grantees under assumed names -- as opposed to transfers to
wholly fictitious or nonexistent entities -- are not generally
barred, the next question we must face is whether Fermell Company
was a fictitious entity or the assumed name of Anton Roeckl.
3. Does a genuine factual issue exist as to
Roeckl's use of Fermell Company as an assumed
business name?
FDIC alleged below, and argues here, that Fermell
Company was a fictitious entity and, as such, was incapable of
receiving title. Roeckl responds that Fermell was his assumed
business name, and he claims that admissible evidence existed to
show that he and Fermell Company concurred in identity. Roeckl's
argument is well founded. In his answers to interrogatories
inquiring about Fermell Company, Roeckl stated:
Fermell Company is the name by which
Anton Roeckl does business. It will become
an investment group when the property is
developed, at which time such group will be
controlled by Anton Roeckl. Anton Roeckl is
involved in many such investments and
developments, but each is independent and
stands on its own in all respects. In this
instance, the group has not yet been
organized, as the property cannot be
developed until the market improves. Fermell
is not a registered corporation. It is a
future partnership into which the current
owner, Anton Roeckl, will invite
investor/partners when he deems the time to
be right to do so.
FDIC nevertheless suggests that Fermell Company must be
considered a fictitious entity because Roeckl's interrogatory
establishes at most that Roeckl assumed the name Fermell Company
for the sole purpose of receiving title from Ferche and that the
company did not exist before the conveyances were made. However,
as is clear from the authorities discussed in the preceding
section of this opinion, a grantee who elects to receive title
under an assumed name need not select a name that the grantee has
previously adopted and used; a name "assumed by [the grantee] for
the occasion is sufficient." 4 Tiffany, supra, 967, at 42
(footnotes omitted).4
FDIC further suggests that the deeds are void because,
on their face, they show that the conveyances from Ferche to
Fermell Company lacked adequate consideration. Specifically,
FDIC asserts that the deeds indicate that Fermell Company paid
only ten dollars for each parcel. FDIC did not raise this
argument below. In any event, it is frivolous. The language of
the deeds recites that the conveyances were made for ten dollars
"and other good and valuable consideration." In his answers to
FDIC's interrogatories, Roeckl stated that he paid $25,000 cash
to Ferche, $20,000 in back taxes and penalties, and committed to
pay Ferche $200,000 when the market would permit profitable
development, in consideration for the parcels.
The factual concerns that FDIC raises may well be
indicators of a fraudulent transaction. As such, however, these
concerns would not conclusively establish that Fermell Company
was a fictitious entity; they would instead amount to "badges of
fraud"raising factual issues ordinarily reserved for trial. See
Blumenstein v. Phillips Ins. Ctr., Inc., 490 P.2d 1213, 1223
(Alaska 1971) (holding that "badges of fraud at most are only
evidentiary facts tending to prove the ultimate fact, which is
that fraud was intended") (quoting Matheson v. Patenaude, 8
Alaska 238, 243 (D. Alaska 1930)); United States v. Leggett, 292
F.2d 423, 426-27 (6th Cir. 1961) (holding that "[i]nadequacy of
consideration, secret or hurried transactions not in the usual
mode of doing business, and the use of dummies or fictitious
parties are common examples of 'badges of fraud'").
Drawing all reasonable inferences in favor of the
nonmoving party and against the movant, Korman, 858 P.2d at 1148,
we conclude that the record establishes a genuine issue of fact
as to whether Fermell Company was an assumed business name that
Roeckl relied on at the time of the conveyances.5 We thus must
address the issue of whether Roeckl was authorized to rely on an
assumed business name that was not formally sanctioned.
4. Was Roeckl legally barred from
taking title under an unregistered
assumed name?
In moving for summary judgment, FDIC alleged without
contradiction that Fermell Company was not registered as a
business in either Alaska or Germany. FDIC argues that Fermell
Company was not a legitimate business entity capable of being
named as a grantee because Roeckl never incorporated, registered,
or otherwise formally organized the company, either in Alaska or
Germany.
FDIC has cited no provision of Alaskan or German law
that forbade Roeckl from doing business as Fermell Company
without formally registering the name. FDIC's argument in favor
of a mandatory registration requirement finds little support as a
matter of common law, which "generally recognizes that persons
may transact business under an assumed or fictitious name as long
as fraud . . . [is] not involved."Platt v. Locke, 358 P.2d 95,
98 (Utah 1961). The proposition appears to be well settled that
"[i]n the absence of a statutory prohibition, a person, without
abandoning his real name, may adopt or assume a name, and he may
use such assumed name to identify himself in the transaction of
his business, the execution of contracts and the carrying on of
his affairs." Kreuter v. United States, 201 F.2d 33, 35 (10th
Cir. 1953).6 This rule is settled in practice as well as in law:
"There is, of course, nothing illegal whatsoever about
transacting business under a fictitious name if the purpose is
not to defraud. It is a common business practice, particularly
on the part of sole proprietorships and partnerships . . . ."
United States v. Dunn, 564 F.2d 348, 354 n.12 (9th Cir. 1977).
FDIC nevertheless points out that most states have
adopted statutes requiring formal registration of assumed
business names.7 Relying on this trend, FDIC urges this court to
depart from the common law rule allowing the unformalized use of
assumed business names. FDIC argues that a judicially created
rule forbidding the use of an unregistered business name is
justified as a matter of public policy in the absence of a
mandatory registration statute. We find FDIC's argument
unpersuasive for several reasons.
The absence of a mandatory registration statute is a
two-edged sword, as the legislature's failure to enact such a
provision may well indicate its preference to allow the informal
use of assumed business names. The Alaska Legislature's failure
to enact a mandatory registration requirement appears to be
particularly significant in light of the business name statutes
that the legislature has in fact enacted. See AS 10.35.010-.085.
Alaska Statute 10.35.010 provides: "The exclusive right to the
use of a business name may be reserved by a person intending to
start a business or a person intending to change the name of the
person's business." The plain wording of this statute indicates
that the legislature intended that registration be permissive
rather than mandatory.8 Of further significance in establishing
the permissive character of Alaska's business name statutes is AS
10.35.080, which specifically states that the statutes'
provisions allowing registration of business names "[do] not
abrogate any rights between persons who have not registered a
business name." Thus, the fact that the legislature has
affirmatively chosen to permit, rather than require, the
registration of assumed business names weighs heavily against
accepting FDIC's invitation to fashion a judicially imposed
registration requirement.
Moreover, it is far from clear that such a requirement
would justify invalidating the conveyances at issue in this case.
Although assumed name statutes differ among the various states
where they have been adopted, they typically do not specify the
effect of a violation on the validity of a contract but rather
merely provide for penalties. Courts construing these statutes
have generally recognized that registration requirements are in
derogation of common law and therefore must be construed
narrowly. See, e.g., Caruso v. Local Union No. 690 of Int'l
Brotherhood of Teamsters, 653 P.2d 638, 642 & n.2 (Wash App.
1982) (citing cases from other jurisdictions). Consequently,
most courts have declined to invalidate contracts entered into in
violation of registration requirements, holding that the
statutorily specified penalties are the sole consequence of a
violation.9
The registration requirement that FDIC urges this court
to create and apply in this case would thus depart not only from
the common law, but also from the majority of cases from other
jurisdictions interpreting mandatory registration statutes. We
are aware of no decision supporting such a departure. Indeed,
FDIC fails to cite any case in which a court, in the absence of
an express statutory prohibition, has departed from the
traditional rule permitting the non-fraudulent use of an assumed
business name for purposes of conveying property. Nor has FDIC
alleged or shown any actual prejudice resulting from Roeckl's use
of an unregistered business name in the present case.10
Under the circumstances, we decline to hold that
Roeckl's failure to register Fermell Company as a business name
would in and of itself preclude Roeckl from using Fermell Company
as an assumed name for purposes of taking title from Ferche. As
with other suspicious circumstances FDIC has pointed to, Roeckl's
use of an unregistered business name that he had apparently never
previously assumed may well constitute a badge of fraud
indicating that the disputed deeds were executed for the purpose
of defrauding Ferche's creditors. As we have already made clear,
however, the issue of fraud is one that the trial court was not
asked to and did not address in deciding FDIC's motion for
partial summary judgment, and it is one that appears to involve
genuinely disputed facts.11
III. CONCLUSION
The record in this case shows the existence of a
genuine issue of material fact as to whether Fermell Company was
Anton Roeckl's assumed business name. The record discloses no
legal basis for concluding that Roeckl was barred from using
Fermell Company as an assumed business name for purposes of
receiving property from Ferche. Accordingly, the superior court
erred in declaring that the warranty deeds executed by Ferche to
Fermell Company were void as a matter of law for lack of a valid
grantee, and in granting summary judgment against Roeckl on that
ground.12
The superior court's order granting partial summary
judgment is REVERSED, and the judgment entered on the basis of
that order is VACATED. This case is REMANDED for further
proceedings consistent with this opinion.
_______________________________
* Sitting by assignment made pursuant to article IV,
section 16 of the Alaska Constitution.
1 FDIC sold the judgments, the promissory notes, and the
modification agreement as assets of the failed bank to itself in
its separate corporate capacity pursuant to AS 06.05.470(1) and
12 U.S.C. 1823(c). FDIC has participated in the current
litigation in that capacity.
2 The superior court's order did not specify whether the
court relied upon FDIC's theory that, as a matter of fact,
"Fermell Company" was not Roeckl's assumed business name, or
FDIC's theory that, as a matter of law, Roeckl did not take the
appropriate legal steps to assume the name.
3 Accord 6 Thompson, supra, 3006, at 354-55 (footnotes
omitted):
A deed to a fictitious grantee is a mere
nullity, and passes no title. Where there is
no such person in existence capable of taking
the title, it will remain in the grantor. On
the other hand, if the grantee be a person in
existence to whom delivery of the deed may be
made, the deed is not a nullity, but
transfers the title to the person to whom it
is delivered. Although an actual person may
take title under an assumed name, a deed to a
fictitious person is inoperative and the
title remains in the grantor. It makes no
difference in the legal effect of a deed
delivered to the actual purchaser that he is
called by some other name than his own. He
may assume a name for the occasion, and a
conveyance to and by him under such name will
pass the title.
4 In its motion for partial summary judgment, FDIC also
maintained that Roeckl's description of Fermell Company as a
"future business partnership"established that Fermell had not
yet been formed as a business and thus was nonexistent when the
deeds were executed. Although FDIC does not expressly advance
this argument on appeal, we note that Roeckl described himself as
the "current owner" of Fermell Company in his interrogatory
response pertaining to a "future business partnership." In
context, Roeckl's reference to a "future business partnership"
could reasonably be understood to mean that at the time of the
conveyances, Fermell Company was a business that Roeckl operated
as a sole owner, but that he envisioned the character of the
business would change to a partnership in the future. Because
all reasonable inferences must be resolved in favor of the
nonmoving party for summary judgment purposes, any ambiguity in
Roeckl's interrogatory concerning the viability of Fermell
Company at the time of the conveyances must be resolved against
FDIC.
5 In response to FDIC's motion for summary judgment,
Roeckl filed a cross-motion for summary judgment requesting that
the court declare the deeds valid. Our conclusion that a genuine
issue of fact exists precludes summary judgment in favor of
Roeckl.
6 See generally Annotation, Doing Business Under an
Assumed Name, 42 A.L.R.2d 516, 1 (1951).
7 See, e.g., Cal. Bus. & Prof. Code 17910 (West 1987)
("Every person who regularly transacts business in [California]
for profit under a fictitious business name shall: (a) File a
fictitious business name statement in accordance with this
chapter not later than 40 days from the time he [or she]
commences to transact such business."). See generally
Annotation, 42 A.L.R.2d 516, 3 (1951).
8 Although we have never had occasion to interpret the
statute, the Attorney General construed it to be permissive, in
accordance with its plain wording. See Attorney General
Opinions, File No. 366-357-84 (February 14, 1984). The precise
question addressed in the Attorney General's opinion is whether a
corporation should be permitted to register an assumed name. The
opinion viewed the issue as depending primarily on the question
of whether a corporation is a "person"within the contemplation
of the reservation of names provision. The opinion concluded
that a corporation is a "person"for purposes of the provision.
In so concluding, it described Alaska's business name statutes,
AS 10.35., in the following terms:
AS 10.35 is . . . a reservation-of-name
statute, an effort by the legislature to
permit a business to reserve and thereby
protect a particular name while at the same
time offering those who deal with that
business access to information concerning the
principals of the business. It does not
preclude registration of a fictitious name,
nor does any other statute prohibit
conducting business under a fictitious name.
. . .
. . . .
[The language of the Alaska Business
Corporation Act (AS 10.05)] makes it apparent
that the legislature intended to permit
registration of all businesses except those
whose names are already protected by the
Corporations Act. Where the business is not
incorporated . . ., we believe the business
should be allowed to register its fictitious
name.
9 See, e.g., Platt, 358 P.2d at 98 ("It is generally
recognized that the legislature in passing such statute did not
intend, in addition to subjecting the offender to an express
penalty, also to impose the additional penalty of refusing him
any relief on the contract."); see also Phillips v. Hoke Constr.,
Inc., 834 S.W.2d 785, 788 (Mo. App. 1982). See generally
Annotation, Doing Business Under an Assumed Name, 42 A.L.R.2d
516, 5 (1951).
10 FDIC argues that "[a]s a matter of policy, Roeckl
should not be permitted to claim title to the properties at issue
under the fictitious name of Fermell Company because such a
result creates potential for fraud and compromises the integrity
of the recording system." However, the recording of the deed
properly put FDIC on notice that Ferche transferred his interest
to Fermell Company. An investigation leads to Roeckl.
FDIC alternatively asserts that if an individual is
able to claim title to property recorded under a fictitious
business name, "one could easily hide personal assets in
derogation of creditor's rights. For instance, a creditor of
Anton Roeckl would not know to search the recording system for
the name of Fermell Company in an attempt to discover Mr.
Roeckl's personal assets in the form of real property." But this
argument proceeds from a wholly implausible premise: that a
debtor sufficiently unscrupulous to conceal assets from creditors
by hiding property in the names of fictitious grantees would be
so scrupulous as to obey the requirements of an assumed name
registration statute. While a registration requirement would
obviate the need for proof of actual fraud and thereby make it
easier to set aside potentially fraudulent conveyances once they
were discovered, it seems questionable that such a requirement
would facilitate the location of fictitious grantees, who would,
in all likelihood, simply go unregistered.
At any rate, the present case clearly did not involve
the potential abuse complained of by FDIC. Roeckl was not the
debtor from whom FDIC sought recovery; rather, FDIC's debtor was
Ferche, the grantor. FDIC was at all times on notice of the
assumed name to whom Ferche conveyed; any potential prejudice lay
in the failure to disclose the actual identity of the grantee.
As we have already indicated, however, FDIC suffered no apparent
prejudice from Ferche's failure to disclose that Fermell Company
was Roeckl's assumed name, since Roeckl responded to the
complaint that was served on Fermell.
11 FDIC contends that summary judgment might alternatively
be justified by reliance on AS 09.25.010(b), a portion of
Alaska's statute of frauds that provides, in pertinent part:
If the estate or interest in real
property is created, transferred or declared
to a nonresident alien or for the benefit of
a nonresident alien, the instrument shall so
state and shall contain the name and address
of the alien.
FDIC asserts that this section prevents nonresident
aliens from using fictitious or assumed names unless disclosure
is made of their address and their interest in the property being
conveyed. Arguably, however, the deeds at issue in this case
substantially complied with this requirement by specifying that
Fermell Company was a foreign business and setting forth its
address. FDIC provides no authority for the proposition that the
statute of frauds' nonresident alien section requires that a deed
identify the grantee's legal name, rather than an assumed name.
Moreover, FDIC advances this argument for the first time on
appeal. Various exceptions to AS 09.25.010 are set forth in AS
09.25.020. Because FDIC did not raise this argument below,
Roeckl has had no opportunity to establish that the disputed
conveyances fall within the statutory exceptions, and the
superior court had no occasion to rule on the issue. Under these
circumstances, we decline to address this issue.
12 Our conclusion that the superior court erred in
granting FDIC's motion for partial summary judgment makes it
unnecessary for us to consider Roeckl's other points on appeal
which address the scope of the final judgment that was entered in
reliance on the partial summary judgment order.
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