CHAPTER 242
UNIFORM FRAUDULENT TRANSFER ACT
242.04 Transfers fraudulent as to present and future creditors.
242.05 Transfers fraudulent as to present creditors.
242.06 When transfer is made or obligation is incurred.
242.07 Remedies of creditors.
242.08 Defenses, liability and protection of transferee.
242.09 Statute of limitation.
242.10 Supplementary provisions.
242.11 Uniformity of application and construction.
242.01
242.01
Definitions. In this chapter:
242.01(1)
(1) "Affiliate" means any of the following:
242.01(1)(a)
(a) A person who directly or indirectly owns, controls or holds with power to vote, 20% or more of the outstanding voting securities of the debtor, other than a person who holds the securities:
242.01(1)(a)1.
1. As a fiduciary or agent without sole discretionary power to vote the securities; or
242.01(1)(a)2.
2. Solely to secure a debt, if the person has not in fact exercised the power to vote.
242.01(1)(b)
(b) A corporation 20% or more of whose outstanding voting securities are directly or indirectly owned, controlled or held with power to vote, by the debtor or a person who directly or indirectly owns, controls or holds with power to vote, 20% or more of the outstanding voting securities of the debtor, other than a person who holds the securities:
242.01(1)(b)1.
1. As a fiduciary or agent without sole discretionary power to vote the securities;
242.01(1)(b)2.
2. Solely to secure a debt, if the person has not in fact exercised the power to vote.
242.01(1)(c)
(c) A person whose business is operated by the debtor under a lease or other agreement, or a person substantially all of whose assets are controlled by the debtor.
242.01(1)(d)
(d) A person who operates the debtor's business under a lease or other agreement or controls substantially all of the debtor's assets.
242.01(2)
(2) "Asset" means property of a debtor, but does not include any of the following:
242.01(2)(a)
(a) Property to the extent it is encumbered by a valid lien.
242.01(2)(b)
(b) Property to the extent it is generally exempt under nonbankruptcy law.
242.01(2)(c)
(c) An interest in property held in tenancy by the entireties to the extent it is not subject to process by a creditor holding a claim against only one tenant.
242.01(3)
(3) "Claim" means a right to payment, whether or not the right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured.
242.01(4)
(4) "Creditor" means a person who has a claim.
242.01(5)
(5) "Debt" means liability on a claim.
242.01(6)
(6) "Debtor" means a person who is liable on a claim.
242.01(7)
(7) "Insider" includes any of the following:
242.01(7)(a)1.
1. A relative of the debtor or of a general partner of the debtor;
242.01(7)(a)2.
2. A partnership in which the debtor is a general partner;
242.01(7)(a)4.
4. A corporation of which the debtor is a director, officer or person in control; or
242.01(7)(a)5.
5. A limited liability company of which the debtor is a manager or person in control.
242.01(7)(b)4.
4. A partnership in which the debtor is a general partner;
242.01(7)(b)6.
6. A relative of a general partner, director, officer or person in control of the debtor.
242.01(7)(bL)
(bL) If the debtor is a limited liability company, any of the following:
242.01(7)(bL)5.
5. A relative of a manager or person in control of the debtor.
242.01(7)(c)2.
2. A relative of a general partner in, a general partner of or a person in control of the debtor;
242.01(7)(c)3.
3. Another partnership in which the debtor is a general partner;
242.01(7)(d)
(d) An affiliate, or an insider of an affiliate as if the affiliate were the debtor.
242.01(8)
(8) "Lien" means a charge against or an interest in property to secure payment of a debt or performance of an obligation, and includes a security interest created by agreement, a judicial lien obtained by legal or equitable process or proceedings, a common-law lien or a statutory lien.
242.01(9)
(9) "Person" means an individual, partnership, corporation, limited liability company, association, organization, government or governmental subdivision or agency, business trust, estate, trust or any other legal or commercial entity.
242.01(10)
(10) "Property" means anything that may be the subject of ownership.
242.01(11)
(11) "Relative" means an individual related by blood within the 3rd degree of kinship as computed under
s. 990.001 (16), a spouse or an individual related to a spouse within the 3rd degree as so computed, and includes an individual in an adoptive relationship within the 3rd degree.
242.01(12)
(12) "Transfer" means every mode, direct or indirect, absolute or conditional, voluntary or involuntary, of disposing of or parting with an asset or an interest in an asset, and includes payment of money, release, lease and creation of a lien or other encumbrance.
242.01(13)
(13) "Valid lien" means a lien that is effective against the holder of a judicial lien subsequently obtained by legal or equitable process or proceedings.
242.02(1)(a)
(a) "Assets" do not include property that has been transferred, concealed or removed with intent to hinder, delay or defraud creditors or that has been transferred in a manner making the transfer voidable under this chapter.
242.02(1)(b)
(b) "Debts" do not include an obligation to the extent it is secured by a valid lien on property of the debtor not included as an asset.
242.02(2)
(2) A debtor is insolvent if the sum of the debtor's debts is greater than all of the debtor's assets at a fair valuation.
242.02(3)
(3) A debtor who is generally not paying debts as they become due is presumed to be insolvent.
242.02(4)
(4) A partnership is insolvent under
sub. (2) if the sum of the partnership's debts is greater than the aggregate, at a fair valuation, of all of the partnership's assets and the sum of the excess of the value of each general partner's nonpartnership assets over the partner's nonpartnership debts.
242.02 History
History: 1987 a. 192.
242.03(1)(1) Value is given for a transfer or an obligation if, in exchange for the transfer or obligation, property is transferred or an antecedent debt is secured or satisfied, but value does not include an unperformed promise made otherwise than in the ordinary course of the promisor's business to furnish support to the debtor or another person.
242.03(2)
(2) For the purposes of
ss. 242.04 (1) (b) and
242.05, a person gives a reasonably equivalent value if the person acquires an interest of the debtor in an asset pursuant to a regularly conducted, noncollusive foreclosure sale or execution of a power of sale for the acquisition or disposition of the interest of the debtor upon default under a mortgage, deed of trust or security agreement.
242.03(3)
(3) A transfer is made for present value if the exchange between the debtor and the transferee is intended by them to be contemporaneous and is in fact substantially contemporaneous.
242.03 History
History: 1987 a. 192.
242.04
242.04
Transfers fraudulent as to present and future creditors. 242.04(1)(1) A transfer made or obligations incurred by a debtor is fraudulent as to a creditor, whether the creditor's claim arose before or after the transfer was made or the obligation was incurred, if the debtor made the transfer or incurred the obligation:
242.04(1)(a)
(a) With actual intent to hinder, delay or defraud any creditor of the debtor; or
242.04(1)(b)
(b) Without receiving a reasonably equivalent value in exchange for the transfer or obligation, and the debtor:
242.04(1)(b)1.
1. Was engaged or was about to engage in a business or a transaction for which the remaining assets of the debtor were unreasonably small in relation to the business or transaction; or
242.04(1)(b)2.
2. Intended to incur, or believed or reasonably should have believed that the debtor would incur, debts beyond the debtor's ability to pay as they became due.
242.04(2)
(2) In determining actual intent under
sub. (1) (a), consideration may be given, among other factors, to whether:
