(a) A transfer or obligation is not voidable under section 651C-4(a)(1) against a person who took in good faith and for a reasonably equivalent value or against any subsequent transferee or obligee.

Terms Used In Hawaii Revised Statutes 651C-8

  • Asset: means property of a debtor but does not include:

    (1) Property to the extent that it is encumbered by a valid lien;

    (2) Property to the extent that it is generally exempt under nonbankruptcy law; or

    (3) An interest in property held in tenancy by the entireties to the extent that it is not subject to process by a creditor holding a claim against only one tenant. See Hawaii Revised Statutes 651C-1

  • 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. See Hawaii Revised Statutes 651C-1
  • Creditor: means a person who has a claim against a debtor. See Hawaii Revised Statutes 651C-1
  • Debt: means liability on a claim. See Hawaii Revised Statutes 651C-1
  • Debtor: means a person against whom a creditor has a claim. See Hawaii Revised Statutes 651C-1
  • Insider: includes :

    (1) If the debtor is an individual:

    (A) A relative of the debtor or of a general partner of the debtor;

    (B) A partnership in which the debtor is a general partner;

    (C) A general partner in a partnership described in subparagraph (B); or

    (D) A corporation of which the debtor is a director, officer, or person in control;

    (2) If the debtor is a corporation:

    (A) A director of the debtor;

    (B) An officer of the debtor;

    (C) A person in control of the debtor;

    (D) A partnership in which the debtor is a general partner;

    (E) A general partner in a partnership described in subparagraph (D); or

    (F) A relative of a general partner, director, officer, or person in control of the debtor;

    (3) If the debtor is a partnership:

    (A) A general partner of the debtor;

    (B) A relative of a general partner in, of a general partner of, or of a person in control of the debtor;

    (C) Another partnership in which the debtor is a general partner;

    (D) A general partner in a partnership described in subparagraph (C); or

    (E) A person in control of the debtor;

    (4) An affiliate, or an insider of an affiliate as if the affiliate were the debtor; and

    (5) A managing agent of the debtor. See Hawaii Revised Statutes 651C-1

  • Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
  • Lien: A claim against real or personal property in satisfaction of a debt.
  • Lien: means a charge against or an interest in property to secure payment of a debt or performance of an obligation, including 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. See Hawaii Revised Statutes 651C-1
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • 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. See Hawaii Revised Statutes 651C-1
  • 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 a payment of money, a release, a lease, and the creation of a lien or encumbrance. See Hawaii Revised Statutes 651C-1
  • Uniform Commercial Code: A set of statutes enacted by the various states to provide consistency among the states' commercial laws. It includes negotiable instruments, sales, stock transfers, trust and warehouse receipts, and bills of lading. Source: OCC
(b) Except as otherwise provided in this section, to the extent a transfer is voidable in an action by a creditor under section 651C-7(a)(1), the creditor may recover judgment for the value of the asset transferred, as adjusted under subsection (c), 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) 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 this chapter, 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 section 651C-4(a)(2) or § 651C-5 if the transfer results from:

(1) Termination of a lease upon default by the debtor when the termination is pursuant to the lease and applicable law; or
(2) Enforcement of a security interest in compliance with Article 9 of the Uniform Commercial Code.
(f) A transfer is not voidable under section 651C-5(b):

(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.
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