I lent money to a small company (owned and run by a family - mom, dad, son). The mom and dad guaranteed the loan. Company defaulted on payment. I sued mom, dad, and son and got entry of default against mom and dad because they fled the country. I sued the son and he has answered. I just looked over bank records and see that company money were given regularly to the daughter (whom I didn't sue because she was an officer of company).
I want to add new claim for fraudulent transfer against daughter. If I amend the complaint - does that mean the entry of default against mom and dad are no longer valid and they can come back and answer?
Yes, unfortunately that is correct. If you file a First Amended Complaint, you need to re-serve all defendants who haven't yet been dismissed. So that means any defaulted defendants now have a chance to file an Answer to the First Amended Complaint.
You are better off filing a separate lawsuit for fraudulent transfer/conveyance, and letting the daughter defendant file a Notice of Related Case and Motion to Consolidate.
Frank W. Chen has been licensed to practice law in California since 1988. The information presented here is general in nature and is not intended, nor should be construed, as legal advice for a particular case. This Avvo.com posting does not create any attorney-client relationship with the author. For specific advice about your particular situation, please consult with your own attorney.
Personal Injury Lawyer
I was going to suggest a strategy, and then saw Mr. Chen's post, which beat me to it.