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ASHMORE v. HERBIE MOREWITZ, INC.

Record Nos. 952137, 952155.

475 S.E.2d 271 (1996)

252 Va. 141

Mildred H. ASHMORE v. HERBIE MOREWITZ, INC., et al. HERBIE MOREWITZ, INC., et al. v. Mildred H. ASHMORE.

Supreme Court of Virginia.

September 13, 1996.

Attorney(s) appearing for the Case

Michael T. Hurd, Gloucester Pt. (Dusewicz & Soberick, on brief), for appellants in No. 952155.

No brief or oral argument on behalf of appellee in No. 952155.

L. Wallace Sink, Hampton (Allen, Sink & Hastings, on brief), for appellant in No. 952137.

Michael T. Hurd (Dusewicz & Soberick, on brief), for appellees Herbie Morewitz, Inc. and Herbert Morewitz, II in No. 952137.

No brief or argument on behalf of appellees Statewide, Inc., Raymond H. Suttle, Jr., Trustee and Richard M. Macaluso, Trustee in No. 952137.

Present: All the Justices.

COMPTON, Justice.

In this creditors' rights controversy arising from a real estate sales transaction, the principal issues are whether fraud has been established in connection with the execution of a subordination agreement and, if so, whether application of the third party beneficiary statute, Code § 55-22, affects the priority of liens. A subsidiary issue deals with the nature of the fraud.

In April 1994, plaintiff Mildred H. Ashmore filed a bill of...

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