Section 5. (a) A transfer made or obligation 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:

Terms Used In Massachusetts General Laws ch. 109A sec. 5

  • Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
  • Insider: includes :

    (i) 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 clause (B); or

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

    (ii) 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 clause (D); or

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

    (iii) if the debtor is a partnership,

    (A) a general partner in the debtor;

    (B) a relative of a general partner in, or a general partner of, or 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 clause (C); or

    (E) a person in control of the debtor;

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

    (v) a managing agent of the debtor. See Massachusetts General Laws ch. 109A sec. 2

  • 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.

(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:

(i) 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

(ii) 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 paragraph (1) of subsection (a), 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.

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