Substitute House Bill No. 6813
          Substitute House Bill No. 6813

              PUBLIC ACT NO. 91-297

AN  ACT  ADOPTING THE UNIFORM FRAUDULENT  TRANSFER
ACT.


    Section  1. (NEW) Sections 1 to 12, inclusive,
of this act may be cited as the Uniform Fraudulent
Transfer Act.
    Sec.  2.  (NEW)  As  used in sections 1 to 12,
inclusive, of this act:
    (1)   "Affiliate"  means:  (A)  A  person  who
directly or indirectly  owns,  controls  or  holds
with power to vote, twenty per cent or more of the
outstanding voting securities of the debtor, other
than  a  person  who holds the securities (i) as a
fiduciary  or  agent  without  sole  discretionary
power  to  vote  the securities, or (ii) solely to
secure a debt, if the person has not exercised the
power  to  vote; (B) a corporation twenty per cent
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, twenty per cent or more of the
outstanding voting securities of the debtor, other
than a person who holds the securities  (i)  as  a
fiduciary  or agent without sole power to vote the
securities; or (ii) solely to secure  a  debt,  if
the  person has not in fact exercised the power to
vote; (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;  or  (D) a person who
operates the debtor's business under  a  lease  or
other  agreement  or controls substantially all of
the debtor's assets.
    (2)  "Asset"  means  property of a debtor, but
the term does not include:  (A)  Property  to  the
extent  it  is  encumbered  by  a  valid lien, (B)
property to the  extent  it  is  generally  exempt
under  nonbankruptcy  law,  or  (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.
    (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.
    (4)  "Creditor"  means  a  person  who  has  a
claim.
    (5) "Debt" means liability on a claim.
    (6)  "Debtor"  means a person who is liable on
a claim.
    (7)  "Insider"  includes: (A) If the debtor is
an individual, (i) a relative of the debtor or  of
a   general   partner   of   the  debtor,  (ii)  a
partnership in  which  the  debtor  is  a  general
partner,  (iii) a general partner in a partnership
described  in  subparagraph  (ii),   or   (iv)   a
corporation  of  which  the  debtor is a director,
officer or person in control; (B) if the debtor is
a  corporation, (i) a director of the debtor, (ii)
an officer  of  the  debtor,  (iii)  a  person  in
control of the debtor, (iv) a partnership in which
the debtor is a general  partner,  (v)  a  general
partner in a partnership described in subparagraph
(iv), or (vi) a relative  of  a  general  partner,
director,  officer  or  person  in  control of the
debtor; (C) if the debtor is a partnership, (i)  a
general  partner in the debtor, (ii) a relative of
a general partner in, a general partner of,  or  a
person  in  control  of  the debtor, (iii) another
partnership in  which  the  debtor  is  a  general
partner,  (iv)  a general partner in a partnership
described in subparagraph (iii), or (v)  a  person
in  control of the debtor; (D) an affiliate, or an
insider of an affiliate as if the  affiliate  were
the  debtor;  and  (E)  a  managing  agent  of the
debtor.
    (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.
    (9)     "Person"    means    an    individual,
partnership,       corporation,       association,
organization,     government    or    governmental
subdivision or  agency,  business  trust,  estate,
trust or any other legal or commercial entity.
    (10)  "Property"  means  anything  that may be
the subject of ownership.
    (11)  "Relative"  means  an individual related
by  consanguinity  within  the  third  degree   as
determined  by  the  common  law,  a  spouse or an
individual related to a spouse  within  the  third
degree   as   so   determined,   and  includes  an
individual in an adoptive relationship within  the
third degree.
    (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.
    (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.
    Sec.  3.  (NEW)  (a)  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.
    (b)  A  debtor who is generally not paying his
debts  as  they  become  due  is  presumed  to  be
insolvent.
    (c)   A   partnership   is   insolvent   under
subsection (a) of this section 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.
    (d)  Assets  under this section 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 sections 1 to
12, inclusive, of this act.
    (e)  Debts  under  this section 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.
    Sec.  4.  (NEW)  (a)  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.
    (b)  For  the  purposes  of subdivision (2) of
subsection (a) of section 5 and section 6 of  this
act,  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.
    (c)  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.
    Sec.   5.   (NEW)  (a)  A  transfer  made   or
obligation incurred by a  debtor  is fraudulent as
to  a  creditor,  if the  creditor's  claim  arose
before the transfer was made or the obligation was
incurred  and  if the debtor made the transfer  or
incurred the obligation:   (1)  With actual intent
to  hinder,  delay or defraud any creditor of  the
debtor; or  (2)  without  receiving  a  reasonably
equivalent  value in exchange for the transfer  or
obligation,  and the debtor (A) 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 (B) intended to incur, or believed
or  reasonably should have believed that he  would
incur,  debts beyond  his  ability  to pay as they
became due.
    (b)   In   determining   actual  intent  under
subdivision (1) of subsection (a) of this section,
consideration  may  be given, among other factors,
to whether: (1) The transfer or obligation was  to
an  insider, (2) the debtor retained possession or
control of  the  property  transferred  after  the
transfer,  (3)  the  transfer  or  obligation  was
disclosed or concealed, (4)  before  the  transfer
was  made  or  obligation was incurred, the debtor
had been sued or threatened  with  suit,  (5)  the
transfer  was  of  substantially  all the debtor's
assets, (6) the debtor absconded, (7)  the  debtor
removed  or concealed assets, (8) the value of the
consideration   received   by   the   debtor   was
reasonably  equivalent  to  the value of the asset
transferred  or  the  amount  of  the   obligation
incurred,  (9)  the debtor was insolvent or became
insolvent shortly after the transfer was  made  or
the  obligation  was  incurred,  (10) the transfer
occurred  shortly  before  or  shortly   after   a
substantial debt was incurred, and (11) the debtor
transferred the essential assets of  the  business
to  a  lienor  who  transferred  the  assets to an
insider of the debtor.
    Sec.   6.   (NEW)   (a)  A  transfer  made  or
obligation incurred by a debtor is  fraudulent  as
to   a  creditor  whose  claim  arose  before  the
transfer was made or the obligation  was  incurred
if  the  debtor  made the transfer or incurred the
obligation   without   receiving   a    reasonably
equivalent  value  in exchange for the transfer or
obligation and the debtor was  insolvent  at  that
time or the debtor became insolvent as a result of
the transfer or obligation.
    (b)  A transfer made by a debtor is fraudulent
as to a creditor  whose  claim  arose  before  the
transfer  was  made if the transfer was made to an
insider for an antecedent  debt,  the  debtor  was
insolvent   at  that  time  and  the  insider  had
reasonable cause to believe that  the  debtor  was
insolvent.
    Sec.  7.  (NEW) For the purposes of sections 1
to 12, inclusive, of this act:
    (1)  A  transfer  is made: (A) With respect to
an asset  that  is  real  property  other  than  a
fixture, but including the interest of a seller or
purchaser under a contract for  the  sale  of  the
asset,  when the transfer is so far perfected that
a good-faith  purchaser  of  the  asset  from  the
debtor  against  whom  applicable  law permits the
transfer  to  be  perfected  cannot   acquire   an
interest  in  the  asset  that  is superior to the
interest of the transferee; and (B)  with  respect
to an asset that is not real property or that is a
fixture, when the transfer  is  so  far  perfected
that  a  creditor  on  a  simple  contract  cannot
acquire  a  judicial  lien  otherwise  than  under
sections  1  to 12, inclusive, of this act that is
superior to the interest of the transferee;
    (2)  If applicable law permits the transfer to
be perfected as provided in subsection (1) of this
section  and  the  transfer  is  not  so perfected
before the commencement of an  action  for  relief
under  sections  1  to 12, inclusive, of this act,
the transfer is deemed made immediately before the
commencement of the action;
    (3)  If  applicable  law  does  not permit the
transfer to be perfected as provided in subsection
(1)  of this section, the transfer is made when it
becomes  effective  between  the  debtor  and  the
transferee;
    (4)  A  transfer  is not made until the debtor
has acquired rights in the asset transferred;
    (5)  An  obligation  is incurred: (A) If oral,
when it becomes effective between the parties,  or
(B)  if  evidenced  by a writing, when the writing
executed by the obligor is delivered to or for the
benefit of the obligee.
    Sec.  8.  (NEW)  (a)  In  an action for relief
against a transfer or obligation under sections  1
to 12, inclusive, of this act, a creditor, subject
to the limitations in section 9 of this  act,  may
obtain:   (1)   Avoidance   of   the  transfer  or
obligation to the extent necessary to satisfy  the
creditor's  claim;  (2)  an  attachment  or  other
provisional remedy against the  asset  transferred
or  other property of the transferee in accordance
with the procedure prescribed by chapter  903a  of
the  general  statutes;  (3) subject to applicable
principles  of  equity  and  in  accordance   with
applicable   rules   of  civil  procedure  (A)  an
injunction  against  further  disposition  by  the
debtor  or  a  transferee,  or  both, of the asset
transferred or of other property, (B)  appointment
of   a  receiver  to  take  charge  of  the  asset
transferred  or   of   other   property   of   the
transferee,   or   (C)   any   other   relief  the
circumstances may require.
    (b)  If  a creditor has obtained a judgment on
a claim against the debtor, the creditor,  if  the
court  so  orders, may levy execution on the asset
transferred or its proceeds.
    Sec.  9. (NEW) (a) A transfer or obligation is
not voidable under  subdivision  (1) of subsection
(a) of section 5 of this act against a person  who
took in good faith and for a reasonably equivalent
value.
    (b)  Except  as  otherwise  provided  in  this
section, to the extent a  transfer  is voidable in
an  action by a creditor under subdivision (1)  of
subsection (a)  of  section  8  of  this act,  the
creditor may recover judgment for the value of the
asset transferred, as  adjusted  under  subsection
(d)  of this section, or the amount  necessary  to
satisfy the creditor's  claim,  whichever is less.
The judgment may be entered against: (1) The first
transferee of the asset  or  the  person for whose
benefit   the  transfer  was  made,   or  (2)  any
subsequent  transferee  other  than  a  good-faith
transferee   who  took  for  value  or  from   any
subsequent transferee.
    (c)  If  the  judgment under subsection (b) of
this section is based upon the value of the  asset
transferred,  the  judgment  must be for an amount
equal to the value of the asset at the time of the
transfer,  subject  to  adjustment as the equities
may require.
    (d)  Notwithstanding voidability of a transfer
or  an  obligation  under  sections   1   to   12,
inclusive, of this act, a good-faith transferee or
obligee is entitled, to the extent  of  the  value
given  the  debtor for the transfer or obligation,
to (1) a lien on or a right to retain any interest
in  the  asset transferred; (2) enforcement of any
obligation incurred; or (3)  a  reduction  in  the
amount of the liability on the judgment.
    (e)   A   transfer   is   not  voidable  under
subdivision (2) of subsection (a) of section 5  or
section 6 of this act if the transfer results from
termination of a lease upon default by the  debtor
when  the termination is pursuant to the lease and
applicable law.
    (f)   A   transfer   is   not  voidable  under
subsection (b) of section 6 of this  act:  (1)  To
the  extent  the  insider gave new value to or for
the benefit of the debtor after the  transfer  was
made  unless  the new value was secured by a valid
lien, (2)  if  made  in  the  ordinary  course  of
business  or  financial  affairs of the debtor and
the  insider,  or  (3)  if  made  pursuant  to   a
good-faith  effort  to rehabilitate the debtor and
the transfer secured present value given for  that
purpose  as  well  as  an  antecedent  debt of the
debtor.
    Sec.  10. (NEW) A cause of action with respect
to  a  fraudulent  transfer  or  obligation  under
sections  1  to  12,  inclusive,  of  this  act is
extinguished unless action is brought:  (1)  Under
subdivision  (1) of subsection (a) of section 5 of
this act, within four years after the transfer was
made  or the obligation was incurred or, if later,
within one year after the transfer  or  obligation
was  or  could  reasonably have been discovered by
the  claimant;  (2)  under  subdivision   (2)   of
subsection  (a)  of section 5 or subsection (a) of
section 6 of this act, within four years after the
transfer  was made or the obligation was incurred;
or (3) under subsection (b) of section 6  of  this
act,  within  one year after the transfer was made
or the obligation was incurred.
    Sec.   11.   (NEW)  Unless  displaced  by  the
provisions of sections 1 to 12, inclusive, of this
act,  the  principles of law and equity, including
the law merchant and the law relating to principal
and     agent,     estoppel,     laches,    fraud,
misrepresentation,  duress,   coercion,   mistake,
insolvency  or  other  validating  or invalidating
cause, supplement the provisions of said sections.
    Sec.  12.  (NEW)  Sections 1 to 11, inclusive,
of this act shall  be  applied  and  construed  to
effectuate  their  general purpose to make uniform
the law  with  respect  to  the  subject  of  said
sections among states enacting them.
    Sec.   13.   Section  52-552  of  the  general
statutes is repealed.