Gerke v. Burton Enterprises, Inc.

1. In this declaratory judgment action, plaintiff seeks reversal of the trial court’s determination that plaintiffs judgment against defendants Burton for fraud is not binding on the Burtons’ assignee, defendant Administrative Services Co. (ASC). We affirm.

In August, 1981, plaintiffs purchased a motel in John Day from the Burtons for $1,100,000. The transaction was memorialized in a land sale contract and a covenant not to compete. In May, 1982, the Burtons assigned their vendors’ interest to ASC as security for a loan. The assignment was recorded. On March 1, 1983, plaintiffs filed an action…