Fei v. Wang CA6

Filed 12/31/20 Fei v. Wang CA6 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SIXTH APPELLATE DISTRICT

LANLAN FEI, H045442 (Santa Clara County Plaintiff and Respondent, Super. Ct. No. 1-12-CV-217620)

v.

HUASHAN WANG,

Defendant, Cross-complainant and Appellant;

BIN HE et al.,

Defendants and Appellants;

LI YI,

Cross-defendant and Respondent.

Li loaned money to Wang to purchase a home in the San Francisco Bay Area.1 Wang failed to record a security interest in the home in favor of Li, sold the home during the pendency of this litigation, and transferred proceeds from the sale to foreign bank accounts. The trial court entered judgment in favor of plaintiff Lanlan Fei (the assignee of Li’s interest in the loan) for breach of contract, fraudulent conveyance, and unjust

1 Li Yi and Yi Li are the same person. We refer to him as Li, as did the trial court in its statement of decision. Li is referred to as Yi Li in the operative complaint; he was sued by Wang as Li Yi, which is the name reflected in the judgment and therefore in our caption.

enrichment against Wang, Wang’s wife (Bin He), and a company formed by the couple. Plaintiff was awarded $2,870,050 in damages, plus pre- and post-judgment interest. Defendants challenge the judgment as to fraudulent conveyance and damages for unjust enrichment. Wang also challenges the rejection of his crossclaim for breach of contract. For the reasons stated here, we will affirm the judgment. I. BACKGROUND Li is the board chairman and chief executive officer of Trony Solar Holding Co. Ltd. (Trony). After he personally approached Li about employment, in 2009 Wang was hired by a wholly owned Trony subsidiary (Shenzen Trony Science and Technology Development Co., Ltd.) as a regional director overseeing marketing, development, and sales in North America. Later that year, Wang entered into a new employment contract with Shenzhen Trony and relocated to China, while his family remained in Massachusetts. Wang approached Li several times in 2010 for a loan to purchase a home in the San Francisco Bay Area. Wang told Li he had bad credit in the United States and could not purchase a home on his own. In 2011 Li extended a $2.2 million personal loan to Wang, conditioned on the purchased home serving as collateral for the loan. Wang and his wife, Bin He, set up two shell companies to facilitate the transaction—Perpetual Renewables Ltd. in the British Virgin Islands (Perpetual) and Bayside Health & Wealth LLC in California (Bayside). In April 2011, Li borrowed $2.2 million from J.P. Morgan using a $3 million life insurance policy as security. The money was wired to Perpetual and used by Bayside to purchase a home in Palo Alto for $1,955,000. Wang did not inform Li that he had purchased the home. In May and June 2011 he told Li he was negotiating the purchase, and in July he reported to Li that his family had moved to California and was living in a rented property while the transaction was in process. In September 2011, Li discovered that Wang had purchased the home in April and his family was living in the home. Li confronted Wang, who agreed to return the 2