Uniform Voidable Transactions Act

The Uniform Voidable Transactions Act (UVTA), known as the Uniform Fraudulent Transfer Act (UFTA) until 2014, is a uniform law providing remedies to creditors for certain debtor transactions that are deemed unfair. The UFTA was adopted by 46 jurisdictions, while the UVTA has currently been adopted in nine states. However, the UVTA is not substantially different from the UFTA, meaning that the vast majority of states have very similar statutes on the subject.

The full text of the final version of the UVTA is located here. Following is a conceptual questionnaire to assist in determining whether a transaction is voidable under the UVTA:

1. Was a transfer made (or obligation incurred) by a debtor?
       a. Yes - Go to Question 2.
       b. No - STOP; no voidable transaction.
2. Was the transfer made with actual intent to hinder, delay, or defraud any creditor? See eleven factor test in UVTA section 4(b).
       a. Yes - STOP; transaction is voidable.
       b. No - Go to Question 3.
3. Was the transfer made (i) after a creditor claim arose (ii) to an insider (iii) for an antecedent debt (iv) when the debtor was insolvent and (v) where the insider had reasonable cause to believe that the debtor was insolvent?
       a. Yes - STOP; transaction is voidable.
       b. No - Go to Question 4.
4. Was the transfer made without receiving a reasonably equivalent value in exchange?
       a. Yes - Go to Question 5.
       b. No - STOP; no voidable transaction.
5. Was the transfer made (i) after a creditor claim and (ii) at a time the debtor was insolvent or the debtor became insolvent as a result of the transfer?
       a. Yes - STOP; transaction is voidable.
       b. No - Go to question 6.
6. Was the debtor engaged in or about to engage in a transaction for which its remaining assets were unreasonably small in relation to the transaction or (ii) intending to incur, or believing or reasonably should have been believing that it would incur debts beyond the its ability to pay as they became due?
       a. Yes - STOP; transaction is voidable.
       b. No - STOP; no voidable transaction.

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