507C.26 - FRAUDULENT TRANSFERS PRIOR TO PETITION.

        507C.26  FRAUDULENT TRANSFERS PRIOR TO PETITION.         1.  A transfer made and an obligation incurred by an insurer      within one year prior to the filing of a successful petition for      rehabilitation or liquidation under this chapter is fraudulent as to      then existing and future creditors if made or incurred without fair      consideration, or with actual intent to hinder, delay, or defraud      either existing or future creditors.  A fraudulent transfer made or      an obligation incurred by an insurer ordered to be rehabilitated or      liquidated under this chapter may be avoided by the receiver, except      as to a person who in good faith is a purchaser, lienor, or obligee      for a present fair equivalent value.  A purchaser, lienor, or      obligee, who in good faith has given a consideration less than fair      for such transfer, lien, or obligation, may retain the property, lien      or obligation as security for repayment.  The court may, on due      notice, order any such transfer or obligation to be preserved for the      benefit of the estate, and in that event, the receiver shall succeed      to and may enforce the rights of the purchaser, lienor, or obligee.         2. a.  A transfer of property other than real property is made      when it becomes perfected so that a subsequent lien obtainable by      legal or equitable proceedings on a simple contract could not become      superior to the rights of the transferee under section 507C.28,      subsection 3.         b.  A transfer of real property is made when it becomes      perfected so that a subsequent bona fide purchaser from the insurer      could not obtain rights superior to the rights of the transferee.         c.  A transfer which creates an equitable lien is not      perfected if there are available means by which a legal lien could be      created.         d.  A transfer not perfected prior to the filing of a petition      for liquidation shall be deemed to be made immediately before the      filing of the successful petition.         e.  This subsection applies whether or not there are or were      creditors who might have obtained a lien or persons who might have      become bona fide purchasers.         3.  A transaction of the insurer with a reinsurer is fraudulent      and may be avoided by the receiver under subsection 1 if both of the      following exist:         a.  The transaction consists of the termination, adjustment,      or settlement of a reinsurance contract in which the reinsurer is      released from any part of its duty to pay the originally specified      share of losses that had occurred prior to the time of the      transaction, unless the reinsurer gives a present fair equivalent      value for the release.         b.  Part of the transaction took place within one year prior      to the date of filing of the petition through which the receivership      was commenced.         4.  A person receiving property from an insurer or any benefit      from an insurer which is a fraudulent transfer under subsection 1 is      personally liable for the property or benefit and shall account to      the liquidator.  
         Section History: Recent Form
         84 Acts, ch 1175, § 26; 93 Acts, ch 88, §7         Referred to in § 507C.14, 507C.21, 507C.35