2006 Utah Code - 31A-27-319 — Avoidance of property title transfers.

     31A-27-319.   Avoidance of property title transfers.

     (1) The rehabilitator or liquidator has the following creditors' rights, without regard to any knowledge of the rehabilitator or liquidator or any creditor:
     (a) The rehabilitator or liquidator is considered to have extended credit to the insurer on the date of the rehabilitation or liquidation petition filing and to have obtained on that date a judicial lien on all the insurer's property on which a creditor under a contract could obtain a judicial lien. The rehabilitator or liquidator may avoid any transfer which would be avoidable by that type of creditor, and has all the other rights and powers of that type of creditor.
     (b) The rehabilitator or liquidator is considered to have extended credit to the insurer on the date of the rehabilitation or liquidation petition filing and to have obtained, on the same date, with respect to that credit extension, an execution against the insurer that was, on the same date, returned unsatisfied. The rehabilitator or liquidator may avoid any transfer which would be avoidable by that type of creditor and has all the other rights and powers of that type of creditor.
     (c) The rehabilitator or liquidator is considered to be a bona fide purchaser of the insurer's real property on the date of rehabilitation or liquidation petition filing and has the rights and powers of a bona fide purchaser to avoid other transfers of the insurer's realty.
     (2) The rehabilitator or liquidator may avoid any transfer of an interest of the insurer in property or any obligation incurred by the insurer that is voidable under applicable law by a creditor holding an unsecured claim. This subsection does not apply to secured claims.
     (3) (a) Except as provided in Subsections (3) (b) and (c), the rehabilitator or liquidator may avoid a transfer of property of the estate that occurs after the date of the filing of the petition for rehabilitation or liquidation and is not authorized under this chapter or by the court.
     (b) A transfer that occurs after the date of filing of the petition, but before the order for rehabilitation or liquidation, is valid against the rehabilitator or liquidator to the extent of any value, including services; but this value does not include the satisfaction or securing of a debt that arose before the date of filing of the petition which is given after that date in exchange for the transfer, notwithstanding the transferee's knowledge or lack of knowledge of the petition.
     (c) The rehabilitator or liquidator may not avoid a transfer of real property under Subsection (3) (a) to a good faith purchaser without knowledge of the petition for rehabilitation or liquidation and for present fair consideration or to a purchaser at a judicial sale, unless a copy of the petition was filed in the office of the county recorder before the transfer was so far perfected that a bona fide purchaser of the property against whom applicable law permits that type of transfer to be perfected cannot acquire an interest that is superior to the interest of the good faith purchaser or judicial sale purchaser. A good faith purchaser of real property, without knowledge of the petition for rehabilitation or liquidation, and who pays less than present fair consideration, under a transfer which that rehabilitator or liquidator may avoid under this section has a lien on the property transferred to the extent of the present consideration given, unless a copy of the petition was filed before the transfer was so perfected.
     (4) An action or proceeding under Subsection (1) or (2) may not be commenced after the earlier of:
     (a) two years after the appointment of a rehabilitator under Section 31A-27-303 or a liquidator under Section 31A-27-310; or
     (b) the date the rehabilitation is terminated under Subsection 31A-27-306 (2) or the liquidation is terminated under Section 31A-27-339.

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     (5) An action or proceeding under Subsection (3) may not be commenced after the earlier of:
     (a) two years after the date of the transfer sought to be avoided; or
     (b) the date the rehabilitation is terminated under Subsection 31A-27-306 (2) or the liquidation is terminated under Section 31A-27-339.

Amended by Chapter 204, 1986 General Session