Wisconsin 2023-2024 Regular Session

Wisconsin Senate Bill SB450 Compare Versions

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Old	New		Differences
1		-	Date of enactment: March 27, 2024
2		-	2023 Senate Bill 450 Date of publication*: March 28, 2024
3		-	2023 WISCONSIN ACT 246
4		-	AN ACT to repeal 242.02 (4); to renumber 242.08 (2) (a); to renumber and amend 242.08 (2) (b); to amend chapter
5		-	242 (title), 242.01 (3), 242.01 (9), 242.01 (12), 242.02 (2), 242.02 (3), 242.04 (title), 242.04 (1) (intro.), 242.05 (title),
6		-	242.05 (1), 242.05 (2), 242.06 (5) (b), 242.07 (1) (b), 242.08 (title), 242.08 (1), 242.08 (2) (intro.), 242.08 (5) (b),
7		-	402.402 (3) (b), 411.308 (2) (b), 705.07 (2), 815.18 (10) and 893.425; and to create 242.01 (6m), 242.01 (8m), 242.01
8		-	(10m), 242.01 (11m), 242.04 (3), 242.05 (3), 242.08 (2) (am) 2. b. and (bm), 242.08 (7) and (8), 242.094, 242.096,
9		-	242.12 and 242.13 of the statutes; relating to: adopting modifications to, and renaming, the Uniform Fraudulent
10		-	Transfer Act.
11		-	The people of the state of Wisconsin, represented in
12		-	senate and assembly, do enact as follows:
13		-	SECTION 1. Chapter 242 (title) of the statutes is
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	2	+	ARG:skw
	3	+	2023 - 2024 LEGISLATURE
	4	+	2023 SENATE BILL 450
	5	+	September 20, 2023 - Introduced by Senators W IMBERGER and BALLWEG,
	6	+	cosponsored by Representatives TUSLER and O'CONNOR. Referred to
	7	+	Committee on Financial Institutions and Sporting Heritage.
	8	+	*AUTHORS SUBJECT TO CHANGE*
	9	+	AN ACT to repeal 242.02 (4); to renumber 242.08 (2) (a); to renumber and
	10	+	amend 242.08 (2) (b); to amend chapter 242 (title), 242.01 (3), 242.01 (9),
	11	+	242.01 (12), 242.02 (2), 242.02 (3), 242.04 (title), 242.04 (1) (intro.), 242.05
	12	+	(title), 242.05 (1), 242.05 (2), 242.06 (5) (b), 242.07 (1) (b), 242.08 (title), 242.08
	13	+	(1), 242.08 (2) (intro.), 242.08 (5) (b), 402.402 (3) (b), 411.308 (2) (b), 705.07 (2),
	14	+	815.18 (10) and 893.425; and to create 242.01 (6m), 242.01 (8m), 242.01 (10m),
	15	+	242.01 (11m), 242.04 (3), 242.05 (3), 242.08 (2) (am) 2. b. and (bm), 242.08 (7)
	16	+	and (8), 242.094, 242.096, 242.12 and 242.13 of the statutes; relating to:
	17	+	adopting modifications to, and renaming, the Uniform Fraudulent Transfer
	18	+	Act.
	19	+	Analysis by the Legislative Reference Bureau
	20	+	This bill adopts the Uniform Law Commission's 2014 modifications to the
	21	+	Uniform Fraudulent Transfer Act, including its renaming as the Uniform Voidable
	22	+	Transactions Law.
	23	+	Current law incorporates the Uniform Fraudulent Transfer Act (1984), adopted
	24	+	in this state in 1988. Under current law, a creditor may challenge certain transfers
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	36	+	SENATE BILL 450
	37	+	of property or obligations incurred by a debtor that may deprive the creditor of assets
	38	+	that would otherwise be available to satisfy debts if the debtor is or is about to become
	39	+	insolvent, such as the transfer of the debtor's assets to a family member or corporate
	40	+	insider. A “creditor” is any person who has a claim and a “debtor” is any person who
	41	+	is liable on a claim. A “claim” is a right to payment, whether it arises by contract,
	42	+	tort, or otherwise, and a “debt” means liability on a claim. There are four basic
	43	+	situations in which the creditor may challenge a transfer made or obligation incurred
	44	+	by the debtor (hereafter referred to as voidable transactions):
	45	+	1. If the transfer is made or obligation incurred by the debtor to intentionally
	46	+	hinder, delay, or defraud the creditor.
	47	+	2. If the debtor transfers property or incurs the obligation without receiving a
	48	+	reasonably equivalent value in exchange, and the debtor engages in business or a
	49	+	transaction for which the debtor's remaining assets are unreasonably small or the
	50	+	debtor intends to incur debts beyond the debtor's ability to pay as they become due.
	51	+	3. If there is an existing creditor-debtor relationship, the debtor makes a
	52	+	transfer or incurs an obligation without receiving a reasonably equivalent value in
	53	+	exchange, and the debtor was insolvent at that time or the debtor became insolvent
	54	+	as a result of the transfer or obligation. A debtor is insolvent if the sum of the debtor's
	55	+	debts is greater than all of the debtor's assets at a fair valuation. A debtor who is
	56	+	generally not paying debts as they become due is presumed to be insolvent.
	57	+	4. If the debtor makes a transfer to an insider for a preexisting debt, the debtor
	58	+	was insolvent at the time of the transfer, and the insider had reasonable cause to
	59	+	believe that the debtor was insolvent. “Insider” is a defined term and includes
	60	+	certain relatives of an individual debtor and officers and directors of a corporate
	61	+	debtor.
	62	+	Current law specifies various remedies available to a creditor if a voidable
	63	+	transaction has occurred. These remedies include the avoidance of the transfer or
	64	+	obligation to the extent necessary to satisfy the creditor's claim, attachment against
	65	+	the asset transferred or other property of the person to whom the asset was
	66	+	transferred, an injunction, and appointment of a receiver.
	67	+	The bill adopts the ULC's 2014 modifications to the uniform act, including the
	68	+	following:
	69	+	1. The bill renames the provisions of the act to be the Uniform Voidable
	70	+	Transactions Law and replaces the term “fraudulent” with “voidable” in various
	71	+	provisions. The ULC specified that these changes were not intended to have
	72	+	substantive effect and were made to more accurately convey the effect of current law,
	73	+	which frequently uses the term “fraudulent” but does not actually require fraudulent
	74	+	activity as a condition to its application.
	75	+	2. The bill creates provisions that specify, for claims and defenses related to
	76	+	voidable transactions, which party has the burden of proof and establishes the
	77	+	standard of proof as a preponderance of the evidence.
	78	+	3. The bill creates a choice-of-law rule for courts to determine which state's
	79	+	voidable transactions law applies in a given case. Under the bill, a court must apply
	80	+	the law of the state where the debtor is located at the time the transfer is made or
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	84	+	SENATE BILL 450
	85	+	4. The bill eliminates a provision that applies a different standard for
	86	+	determining insolvency for a partnership, so that the general insolvency standard
	87	+	applies to partnerships.
	88	+	The people of the state of Wisconsin, represented in senate and assembly, do
	89	+	enact as follows:
	90	+	SECTION 1. Chapter 242 (title) of the statutes is amended to read:
	91	+	CHAPTER 242
	92	+	UNIFORM FRAUDULENT TRANSFER ACT
	93	+	VOIDABLE TRANSACTIONS LA W
	94	+	SECTION 2. 242.01 (3) of the statutes is amended to read:
	95	+	242.01 (3) “Claim" “Claim,” except as used in “claim for relief,” means a right
	96	+	to payment, whether or not the right is reduced to judgment, liquidated,
	97	+	unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal,
	98	+	equitable, secured or unsecured.
	99	+	SECTION 3. 242.01 (6m) of the statutes is created to read:
	100	+	242.01 (6m) “Electronic" means relating to technology having electrical,
	101	+	digital, magnetic, wireless, optical, electromagnetic, or similar capabilities.
	102	+	SECTION 4. 242.01 (8m) of the statutes is created to read:
	103	+	242.01 (8m) “Organization” means a person other than an individual.
	104	+	SECTION 5. 242.01 (9) of the statutes is amended to read:
	105	+	242.01 (9) “Person" means an individual, estate, partnership, corporation,
	106	+	limited liability company, association, organization, trust, business or nonprofit
	107	+	entity, public corporation, government or governmental subdivision or, agency,
	108	+	business trust, estate, trust or instrumentality, or any other legal or commercial
	109	+	entity.
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	131	+	SECTION 6 SENATE BILL 450
	132	+	SECTION 6. 242.01 (10m) of the statutes is created to read:
	133	+	242.01 (10m) “Record" means information that is inscribed on a tangible
	134	+	medium or that is stored in an electronic or other medium and is retrievable in
	135	+	perceivable form.
	136	+	SECTION 7. 242.01 (11m) of the statutes is created to read:
	137	+	242.01 (11m) “Sign" means, with present intent to authenticate or adopt a
	138	+	record, any of the following:
	139	+	(a) To execute or adopt a tangible symbol.
	140	+	(b) To attach to or logically associate with the record an electronic symbol,
	141	+	sound, or process.
	142	+	SECTION 8. 242.01 (12) of the statutes is amended to read:
	143	+	242.01 (12) “Transfer" means every mode, direct or indirect, absolute or
	144	+	conditional, voluntary or involuntary, of disposing of or parting with an asset or an
	145	+	interest in an asset, and includes payment of money, release, lease, license, and
	146	+	creation of a lien or other encumbrance.
	147	+	SECTION 9. 242.02 (2) of the statutes is amended to read:
	148	+	242.02 (2) A debtor is insolvent if, at a fair valuation, the sum of the debtor's
	149	+	debts is greater than all the sum of the debtor's assets at a fair valuation.
	150	+	SECTION 10. 242.02 (3) of the statutes is amended to read:
	151	+	242.02 (3) A debtor who is generally not paying the debtor's debts as they
	152	+	become due other than as a result of a bona fide dispute is presumed to be insolvent.
	153	+	The presumption imposes on the party against which the presumption is directed the
	154	+	burden of proving that the nonexistence of insolvency is more probable than its
	155	+	existence.
	156	+	SECTION 11. 242.02 (4) of the statutes is repealed.
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	184	+	SECTION 12
	185	+	SENATE BILL 450
	186	+	SECTION 12. 242.04 (title) of the statutes is amended to read:
	187	+	242.04 (title) Transfers fraudulent Transfer or obligation voidable as
	188	+	to present and or future creditors creditor.
	189	+	SECTION 13. 242.04 (1) (intro.) of the statutes is amended to read:
	190	+	242.04 (1) (intro.) A transfer made or obligations obligation incurred by a
	191	+	debtor is fraudulent voidable as to a creditor, whether the creditor's claim arose
	192	+	before or after the transfer was made or the obligation was incurred, if the debtor
	193	+	made the transfer or incurred the obligation:
	194	+	SECTION 14. 242.04 (3) of the statutes is created to read:
	195	+	242.04 (3) A creditor making a claim for relief under sub. (1) has the burden
	196	+	of proving the elements of the claim for relief by a preponderance of the evidence.
	197	+	SECTION 15. 242.05 (title) of the statutes is amended to read:
	198	+	242.05 (title) Transfers fraudulent Transfer or obligation voidable as
	199	+	to present creditors creditor.
	200	+	SECTION 16. 242.05 (1) of the statutes is amended to read:
	201	+	242.05 (1) A transfer made or obligation incurred by a debtor is fraudulent
	202	+	voidable as to a creditor whose claim arose before the transfer was made or the
	203	+	obligation was incurred if the debtor made the transfer or incurred the obligation
	204	+	without receiving a reasonably equivalent value in exchange for the transfer or
	205	+	obligation and the debtor was insolvent at that time or the debtor became insolvent
	206	+	as a result of the transfer or obligation.
	207	+	SECTION 17. 242.05 (2) of the statutes is amended to read:
	208	+	242.05 (2) A transfer made by a debtor is fraudulent voidable as to a creditor
	209	+	whose claim arose before the transfer was made if the transfer was made to an
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	235	+	SECTION 17 SENATE BILL 450
	236	+	insider for an antecedent debt, the debtor was insolvent at that time and the insider
	237	+	had reasonable cause to believe that the debtor was insolvent.
	238	+	SECTION 18. 242.05 (3) of the statutes is created to read:
	239	+	242.05 (3) Subject to s. 242.02 (3), a creditor making a claim for relief under
	240	+	sub. (1) or (2) has the burden of proving the elements of the claim for relief by a
	241	+	preponderance of the evidence.
	242	+	SECTION 19. 242.06 (5) (b) of the statutes is amended to read:
	243	+	242.06 (5) (b) If evidenced by a writing record, when the writing executed
	244	+	record signed by the obligor is delivered to or for the benefit of the obligee.
	245	+	SECTION 20. 242.07 (1) (b) of the statutes is amended to read:
	246	+	242.07 (1) (b) An attachment or other provisional remedy against the asset
	247	+	transferred or other property of the transferee in accordance with if available under
	248	+	chs. 810 to 813 or other applicable law.
	249	+	SECTION 21. 242.08 (title) of the statutes is amended to read:
	250	+	242.08 (title) Defenses, liability, and protection of transferee or obligee.
	251	+	SECTION 22. 242.08 (1) of the statutes is amended to read:
	252	+	242.08 (1) A transfer or obligation is not voidable under s. 242.04 (1) (a) against
	253	+	a person who took in good faith and for a reasonably equivalent value given the
	254	+	debtor or against any subsequent transferee or obligee.
	255	+	SECTION 23. 242.08 (2) (intro.) of the statutes is amended to read:
	256	+	242.08 (2) (intro.) Except as otherwise provided in this section, to To the extent
	257	+	a transfer is voidable in an action by a creditor under s. 242.07 (1) (a), all of the
	258	+	following rules apply:
	259	+	(am) Except as otherwise provided in this section, the creditor may recover
	260	+	judgment for the value of the asset transferred, as adjusted under sub. (3), or the
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	288	+	SECTION 23
	289	+	SENATE BILL 450
	290	+	amount necessary to satisfy the creditor's claim, whichever is less. The judgment
	291	+	may be entered against any of the following:
	292	+	SECTION 24. 242.08 (2) (a) of the statutes is renumbered 242.08 (2) (am) 1.
	293	+	SECTION 25. 242.08 (2) (am) 2. b. and (bm) of the statutes are created to read:
	294	+	242.08 (2) (am) 2. b. An immediate or mediate good faith transferee of a person
	295	+	described in subd. 2. a.
	296	+	(bm) Recovery pursuant to s. 242.07 (1) (a) or (2) of or from the asset transferred
	297	+	or its proceeds, by levy or otherwise, is available only against a person described in
	298	+	par. (am) 1. or 2.
	299	+	SECTION 26. 242.08 (2) (b) of the statutes is renumbered 242.08 (2) (am) 2. and
14	300		amended to read:
15		-	CHAPTER 242
16		-	UNIFORM FRAUDULENT TRANSFER ACT
17		-	VOIDABLE TRANSACTIONS LA W
18		-	SECTION 2. 242.01 (3) of the statutes is amended to
19		-	read:
20		-	242.01 (3) “Claim” “Claim,” except as used in “claim
21		-	for relief,” means a right to payment, whether or not the
22		-	right is reduced to judgment, liquidated, unliquidated,
23		-	fixed, contingent, matured, unmatured, disputed, undis-
24		-	puted, legal, equitable, secured or unsecured.
25		-	SECTION 3. 242.01 (6m) of the statutes is created to
26		-	read:
27		-	242.01 (6m) “Electronic” means relating to technol-
28		-	ogy having electrical, digital, magnetic, wireless, optical,
29		-	electromagnetic, or similar capabilities.
30		-	SECTION 4. 242.01 (8m) of the statutes is created to
31		-	read:
32		-	242.01 (8m) “Organization” means a person other
33		-	than an individual.
34		-	SECTION 5. 242.01 (9) of the statutes is amended to
35		-	read:
36		-	242.01 (9) “Person” means an individual, estate,
37		-	partnership, corporation, limited liability company, asso-
38		-	ciation, organization, trust, business or nonprofit entity,
39		-	public corporation, government or governmental subdi-
40		-	vision or, agency, business trust, estate, trust or instru-
41		-	mentality, or any other legal or commercial entity.
42		-	SECTION 6. 242.01 (10m) of the statutes is created to
43		-	read:
44		-	242.01 (10m) “Record” means information that is
45		-	inscribed on a tangible medium or that is stored in an
46		-	electronic or other medium and is retrievable in perceiv-
47		-	able form.
48		-	SECTION 7. 242.01 (11m) of the statutes is created to
49		-	read:
50		-	242.01 (11m) “Sign” means, with present intent to
51		-	authenticate or adopt a record, any of the following:
52		-	(a) To execute or adopt a tangible symbol.
53		-	* Section 991.11, WISCONSIN STATUTES: Effective date of acts. “Every act and every portion of an act enacted by the legislature over the governor’s
54		-	partial veto which does not expressly prescribe the time when it takes effect shall take effect on the day after its date of publication.” − 2 −2023 Wisconsin Act 246 2023 Senate Bill 450
55		-	(b) To attach to or logically associate with the record
56		-	an electronic symbol, sound, or process.
57		-	SECTION 8. 242.01 (12) of the statutes is amended to
58		-	read:
59		-	242.01 (12) “Transfer” means every mode, direct or
60		-	indirect, absolute or conditional, voluntary or involun-
61		-	tary, of disposing of or parting with an asset or an interest
62		-	in an asset, and includes payment of money, release,
63		-	lease, license, and creation of a lien or other encum-
64		-	brance.
65		-	SECTION 9. 242.02 (2) of the statutes is amended to
66		-	read:
67		-	242.02 (2) A debtor is insolvent if, at a fair valuation,
68		-	the sum of the debtor’s debts is greater than all the sum
69		-	of the debtor’s assets at a fair valuation.
70		-	SECTION 10. 242.02 (3) of the statutes is amended to
71		-	read:
72		-	242.02 (3) A debtor who is generally not paying the
73		-	debtor’s debts as they become due other than as a result
74		-	of a bona fide dispute is presumed to be insolvent. The
75		-	presumption imposes on the party against which the pre-
76		-	sumption is directed the burden of proving that the
77		-	nonexistence of insolvency is more probable than its
78		-	existence.
79		-	SECTION 11. 242.02 (4) of the statutes is repealed.
80		-	SECTION 12. 242.04 (title) of the statutes is amended
81		-	to read:
82		-	242.04 (title) Transfers fraudulent Transfer or
83		-	obligation voidable as to present and or future credi-
84		-	tors creditor.
85		-	SECTION 13. 242.04 (1) (intro.) of the statutes is
86		-	amended to read:
87		-	242.04 (1) (intro.) A transfer made or obligations
88		-	obligation incurred by a debtor is fraudulent voidable as
89		-	to a creditor, whether the creditor’s claim arose before or
90		-	after the transfer was made or the obligation was
91		-	incurred, if the debtor made the transfer or incurred the
92		-	obligation:
93		-	SECTION 14. 242.04 (3) of the statutes is created to
94		-	read:
95		-	242.04 (3) A creditor making a claim for relief under
96		-	sub. (1) has the burden of proving the elements of the
97		-	claim for relief by a preponderance of the evidence.
98		-	SECTION 15. 242.05 (title) of the statutes is amended
99		-	to read:
100		-	242.05 (title) Transfers fraudulent Transfer or
101		-	obligation voidable as to present creditors creditor.
102		-	SECTION 16. 242.05 (1) of the statutes is amended to
103		-	read:
104		-	242.05 (1) A transfer made or obligation incurred by
105		-	a debtor is fraudulent voidable as to a creditor whose
106		-	claim arose before the transfer was made or the obliga-
107		-	tion was incurred if the debtor made the transfer or
108		-	incurred the obligation without receiving a reasonably
109		-	equivalent value in exchange for the transfer or obliga-
110		-	tion and the debtor was insolvent at that time or the debtor
111		-	became insolvent as a result of the transfer or obligation.
112		-	SECTION 17. 242.05 (2) of the statutes is amended to
113		-	read:
114		-	242.05 (2) A transfer made by a debtor is fraudulent
115		-	voidable as to a creditor whose claim arose before the
116		-	transfer was made if the transfer was made to an insider
117		-	for an antecedent debt, the debtor was insolvent at that
118		-	time and the insider had reasonable cause to believe that
119		-	the debtor was insolvent.
120		-	SECTION 18. 242.05 (3) of the statutes is created to
121		-	read:
122		-	242.05 (3) Subject to s. 242.02 (3), a creditor making
123		-	a claim for relief under sub. (1) or (2) has the burden of
124		-	proving the elements of the claim for relief by a prepon-
125		-	derance of the evidence.
126		-	SECTION 19. 242.06 (5) (b) of the statutes is amended
127		-	to read:
128		-	242.06 (5) (b) If evidenced by a writing record, when
129		-	the writing executed record signed by the obligor is deliv-
130		-	ered to or for the benefit of the obligee.
131		-	SECTION 20. 242.07 (1) (b) of the statutes is amended
132		-	to read:
133		-	242.07 (1) (b) An attachment or other provisional
134		-	remedy against the asset transferred or other property of
135		-	the transferee in accordance with if available under chs.
136		-	810 to 813 or other applicable law.
137		-	SECTION 21. 242.08 (title) of the statutes is amended
138		-	to read:
139		-	242.08 (title) Defenses, liability, and protection of
140		-	transferee or obligee.
141		-	SECTION 22. 242.08 (1) of the statutes is amended to
142		-	read:
143		-	242.08 (1) A transfer or obligation is not voidable
144		-	under s. 242.04 (1) (a) against a person who took in good
145		-	faith and for a reasonably equivalent value given the
146		-	debtor or against any subsequent transferee or obligee.
147		-	SECTION 23. 242.08 (2) (intro.) of the statutes is
148		-	amended to read:
149		-	242.08 (2) (intro.) Except as otherwise provided in
150		-	this section, to To the extent a transfer is voidable in an
151		-	action by a creditor under s. 242.07 (1) (a), all of the fol-
152		-	lowing rules apply:
153		-	(am) Except as otherwise provided in this section, the
154		-	creditor may recover judgment for the value of the asset
155		-	transferred, as adjusted under sub. (3), or the amount nec-
156		-	essary to satisfy the creditor’s claim, whichever is less.
157		-	The judgment may be entered against any of the follow-
158		-	ing:
159		-	SECTION 24. 242.08 (2) (a) of the statutes is renum-
160		-	bered 242.08 (2) (am) 1.
161		-	SECTION 25. 242.08 (2) (am) 2. b. and (bm) of the
162		-	statutes are created to read:
163		-	242.08 (2) (am) 2. b. An immediate or mediate good
164		-	faith transferee of a person described in subd. 2. a. − 3 − 2023 Wisconsin Act 246 2023 Senate Bill 450
165		-	(bm) Recovery pursuant to s. 242.07 (1) (a) or (2) of
166		-	or from the asset transferred or its proceeds, by levy or
167		-	otherwise, is available only against a person described in
168		-	par. (am) 1. or 2.
169		-	SECTION 26. 242.08 (2) (b) of the statutes is renum-
170		-	bered 242.08 (2) (am) 2. (intro.) and amended to read:
171		-	242.08 (2) (am) 2. (intro.) Any subsequent An imme-
172		-	diate or mediate transferee of the first transferee, other
173		-	than a any of the following:
174		-	a. A good faith transferee who took for value or from
175		-	any subsequent transferee.
176		-	SECTION 27. 242.08 (5) (b) of the statutes is amended
177		-	to read:
178		-	242.08 (5) (b) Enforcement of a security interest in
179		-	compliance with ch. 409, other than acceptance of collat-
180		-	eral in full or partial satisfaction of the obligation it
	301	+	242.08 (2) (am) 2. Any subsequent An immediate or mediate transferee of the
	302	+	first transferee, other than a any of the following:
	303	+	a. A good faith transferee who took for value or from any subsequent transferee.
	304	+	SECTION 27. 242.08 (5) (b) of the statutes is amended to read:
	305	+	242.08 (5) (b) Enforcement of a security interest in compliance with ch. 409,
	306	+	other than acceptance of collateral in full or partial satisfaction of the obligation it
181	307		secures.
182		-	SECTION 28. 242.08 (7) and (8) of the statutes are cre-
183		-	ated to read:
184		-	242.08 (7) The following rules determine the burden
185		-	of proving matters referred to in this section:
186		-	(a) A party that seeks to invoke sub. (1), (4), (5), or
187		-	(6) has the burden of proving the applicability of that sub-
188		-	section.
189		-	(b) Except as otherwise provided in pars. (c) and (d),
190		-	the creditor has the burden of proving each applicable
191		-	element of sub. (2) or (3).
192		-	(c) The transferee has the burden of proving the
193		-	applicability to the transferee of sub. (2) (am) 2. a. or b.
194		-	(d) A party that seeks adjustment under sub. (3) has
195		-	the burden of proving the adjustment.
196		-	(8) The standard of proof required to establish mat-
197		-	ters referred to in this section is preponderance of the evi-
198		-	dence.
199		-	SECTION 29. 242.094 of the statutes is created to read:
200		-	242.094 Governing law. (1) In this section, the fol-
201		-	lowing rules determine a debtor’s location:
202		-	(a) A debtor who is an individual is located at the
203		-	individual’s principal residence.
204		-	(b) A debtor that is an organization and has only one
205		-	place of business is located at its place of business.
206		-	(c) A debtor that is an organization and that has more
207		-	than one place of business is located at its chief executive
208		-	office.
209		-	(2) A claim for relief in the nature of a claim for relief
210		-	under this chapter is governed by the local law of the
211		-	jurisdiction in which the debtor is located when the trans-
212		-	fer is made or the obligation is incurred.
213		-	SECTION 30. 242.096 of the statutes is created to read:
214		-	242.096 Application to series organization. (1) In
215		-	this section:
216		-	(a) “Protected series” means an arrangement, how-
217		-	ever denominated, created by a series organization that,
218		-	pursuant to the law under which the series organization
219		-	is organized, has the characteristics set forth in par. (b).
220		-	(b) “Series organization” means an organization that,
221		-	pursuant to the law under which it is organized, has the
222		-	following characteristics:
223		-	1. The organic record of the organization provides for
224		-	creation by the organization of one or more protected
225		-	series, however denominated, with respect to specified
226		-	property of the organization, and for records to be main-
227		-	tained for each protected series that identify the property
228		-	of or associated with the protected series.
229		-	2. Debt incurred or existing with respect to the activi-
230		-	ties of, or property of or associated with, a particular pro-
231		-	tected series is enforceable against the property of or
232		-	associated with the protected series only, and not against
233		-	the property of or associated with the organization or
234		-	other protected series of the organization.
235		-	3. Debt incurred or existing with respect to the activi-
236		-	ties or property of the organization is enforceable against
237		-	the property of the organization only, and not against the
238		-	property of or associated with a protected series of the
	308	+	SECTION 28. 242.08 (7) and (8) of the statutes are created to read:
	309	+	242.08 (7) The following rules determine the burden of proving matters
	310	+	referred to in this section:
	311	+	(a) A party that seeks to invoke sub. (1), (4), (5), or (6) has the burden of proving
	312	+	the applicability of that subsection.
	313	+	(b) Except as otherwise provided in pars. (c) and (d), the creditor has the burden
	314	+	of proving each applicable element of sub. (2) or (3).
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	341	+	SECTION 28 SENATE BILL 450
	342	+	(c) The transferee has the burden of proving the applicability to the transferee
	343	+	of sub. (2) (am) 2. a. or b.
	344	+	(d) A party that seeks adjustment under sub. (3) has the burden of proving the
	345	+	adjustment.
	346	+	(8) The standard of proof required to establish matters referred to in this
	347	+	section is preponderance of the evidence.
	348	+	SECTION 29. 242.094 of the statutes is created to read:
	349	+	242.094 Governing law. (1) In this section, the following rules determine a
	350	+	debtor's location:
	351	+	(a) A debtor who is an individual is located at the individual's principal
	352	+	residence.
	353	+	(b) A debtor that is an organization and has only one place of business is located
	354	+	at its place of business.
	355	+	(c) A debtor that is an organization and that has more than one place of
	356	+	business is located at its chief executive office.
	357	+	(2) A claim for relief in the nature of a claim for relief under this chapter is
	358	+	governed by the local law of the jurisdiction in which the debtor is located when the
	359	+	transfer is made or the obligation is incurred.
	360	+	SECTION 30. 242.096 of the statutes is created to read:
	361	+	242.096 Application to series organization. (1) In this section:
	362	+	(a) “Protected series” means an arrangement, however denominated, created
	363	+	by a series organization that, pursuant to the law under which the series
	364	+	organization is organized, has the characteristics set forth in par. (b).
	365	+	(b) “Series organization” means an organization that, pursuant to the law
	366	+	under which it is organized, has the following characteristics:
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	394	+	SECTION 30
	395	+	SENATE BILL 450
	396	+	1. The organic record of the organization provides for creation by the
	397	+	organization of one or more protected series, however denominated, with respect to
	398	+	specified property of the organization, and for records to be maintained for each
	399	+	protected series that identify the property of or associated with the protected series.
	400	+	2. Debt incurred or existing with respect to the activities of, or property of or
	401	+	associated with, a particular protected series is enforceable against the property of
	402	+	or associated with the protected series only, and not against the property of or
	403	+	associated with the organization or other protected series of the organization.
	404	+	3. Debt incurred or existing with respect to the activities or property of the
	405	+	organization is enforceable against the property of the organization only, and not
	406	+	against the property of or associated with a protected series of the organization.
	407	+	(2) A series organization and each protected series of the organization is a
	408	+	separate person for purposes of this chapter, even if for other purposes a protected
	409	+	series is not a person separate from the organization or other protected series of the
239	410		organization.
240		-	(2) A series organization and each protected series of
241		-	the organization is a separate person for purposes of this
242		-	chapter, even if for other purposes a protected series is not
243		-	a person separate from the organization or other pro-
244		-	tected series of the organization.
245		-	SECTION 31. 242.12 of the statutes is created to read:
246		-	242.12 Relation to electronic signatures in global
247		-	and national commerce act. This chapter modifies,
248		-	limits, or supersedes the federal Electronic Signatures in
249		-	Global and National Commerce Act, 15 USC 7001 to
250		-	7031, but does not modify, limit, or supersede section 101
251		-	(c) of that act, 15 USC 7001 (c), or authorize electronic
252		-	delivery of any of the notices described in section 103 (b)
253		-	of that act, 15 USC 7003 (b).
254		-	SECTION 32. 242.13 of the statutes is created to read:
255		-	242.13 Short title. This chapter may be cited as the
256		-	Uniform Voidable Transactions Law.
257		-	SECTION 33. 402.402 (3) (b) of the statutes is
258		-	amended to read:
259		-	402.402 (3) (b) Where identification to the contract
260		-	or delivery is made not in current course of trade but in
261		-	satisfaction of or as security for a preexisting claim for
262		-	money, security or the like and is made under circum-
263		-	stances which under any rule of law of the state where the
264		-	goods are situated would apart from this chapter consti-
265		-	tute the transaction a fraudulent or voidable transfer or
266		-	voidable preference.
267		-	SECTION 34. 411.308 (2) (b) of the statutes is
268		-	amended to read:
269		-	411.308 (2) (b) The lease contract is made under cir-
270		-	cumstances that under any statute or rule of law apart
271		-	from this chapter would constitute the transaction a
	411	+	SECTION 31. 242.12 of the statutes is created to read:
	412	+	242.12 Relation to electronic signatures in global and national
	413	+	commerce act. This chapter modifies, limits, or supersedes the federal Electronic
	414	+	Signatures in Global and National Commerce Act, 15 USC 7001 to 7031, but does not
	415	+	modify, limit, or supersede section 101 (c) of that act, 15 USC 7001 (c), or authorize
	416	+	electronic delivery of any of the notices described in section 103 (b) of that act, 15 USC
	417	+	7003 (b).
	418	+	SECTION 32. 242.13 of the statutes is created to read:
	419	+	242.13 Short title. This chapter may be cited as the Uniform Voidable
	420	+	Transactions Law.
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	447	+	SECTION 33 SENATE BILL 450
	448	+	SECTION 33. 402.402 (3) (b) of the statutes is amended to read:
	449	+	402.402 (3) (b) Where identification to the contract or delivery is made not in
	450	+	current course of trade but in satisfaction of or as security for a preexisting claim for
	451	+	money, security or the like and is made under circumstances which under any rule
	452	+	of law of the state where the goods are situated would apart from this chapter
	453	+	constitute the transaction a fraudulent or voidable transfer or voidable preference.
	454	+	SECTION 34. 411.308 (2) (b) of the statutes is amended to read:
	455	+	411.308 (2) (b) The lease contract is made under circumstances that under any
	456	+	statute or rule of law apart from this chapter would constitute the transaction a
272	457		fraudulent or voidable transfer or voidable preference.
273		-	SECTION 35. 705.07 (2) of the statutes is amended to
274		-	read: − 4 −2023 Wisconsin Act 246 2023 Senate Bill 450
275		-	705.07 (2) For purposes of ch. 242, a debtor party
276		-	shall be deemed to have made a transfer only at the time
277		-	some other party withdraws all or part of the sums on
278		-	deposit, or at the time of the debtor party’s death as to
279		-	sums not previously withdrawn. In the case of a with-
280		-	drawal while the debtor party is living, the sole grounds
281		-	for determining any such transfer to be fraudulent void-
282		-	able shall be whether the debtor party is or will be thereby
283		-	rendered insolvent under s. 242.05 (1) or whether the
284		-	debtor party is engaged or is about to engage in a business
285		-	or transaction for which the assets remaining in the
286		-	debtor party’s hands after the transfer are unreasonably
287		-	small under s. 242.04 (1) (b) 1. In the case of a transfer
288		-	by reason of the death of the debtor party, the sole ground
289		-	for determining any such transfer to be fraudulent void-
290		-	able shall be whether the debtor party’s estate subject to
291		-	administration is insolvent under s. 242.02. For purposes
292		-	of this subsection, the amount transferred shall be
293		-	deemed to consist of those assets which the creditors of
294		-	the debtor party could have made subject to their claims
295		-	immediately prior to the transfer, less any sums which
296		-	such creditors could have made so subject to their claims
297		-	immediately after the transfer.
298		-	SECTION 36. 815.18 (10) of the statutes is amended
299		-	to read:
300		-	815.18 (10) FRAUDULENT AND VOIDABLE TRANSFERS.
301		-	A conveyance or transfer of wholly exempt property
302		-	shall not be considered a fraudulent conveyance or a
303		-	fraudulent or voidable transfer. Property that is not
304		-	totally exempt in value under this section may be subject
305		-	to a fraudulent voidable transfer action under ch. 242 to
306		-	set aside that transfer to the extent that the property’s
307		-	value is not exempt under this section. If a court is
308		-	required to satisfy the claim of a creditor and if that relief
309		-	is demanded, the court may determine the manner of
310		-	dividing fraudulently transferred property or property for
311		-	which the transfer is voidable into exempt and nonex-
312		-	empt portions, or may order the sale of the whole prop-
313		-	erty and an accounting of the exempt portion. Any or all
314		-	of the exemptions granted by this section may be denied
315		-	if, in the discretion of the court having jurisdiction, the
316		-	debtor procured, concealed or transferred assets with the
317		-	intention of defrauding creditors.
318		-	SECTION 37. 893.425 of the statutes is amended to
319		-	read:
320		-	893.425 Fraudulent Voidable transfers and obli-
321		-	gations. An action with respect to a fraudulent transfer
322		-	or obligation under ch. 242 shall be barred unless the
	458	+	SECTION 35. 705.07 (2) of the statutes is amended to read:
	459	+	705.07 (2) For purposes of ch. 242, a debtor party shall be deemed to have made
	460	+	a transfer only at the time some other party withdraws all or part of the sums on
	461	+	deposit, or at the time of the debtor party's death as to sums not previously
	462	+	withdrawn. In the case of a withdrawal while the debtor party is living, the sole
	463	+	grounds for determining any such transfer to be fraudulent voidable shall be
	464	+	whether the debtor party is or will be thereby rendered insolvent under s. 242.05 (1)
	465	+	or whether the debtor party is engaged or is about to engage in a business or
	466	+	transaction for which the assets remaining in the debtor party's hands after the
	467	+	transfer are unreasonably small under s. 242.04 (1) (b) 1. In the case of a transfer
	468	+	by reason of the death of the debtor party, the sole ground for determining any such
	469	+	transfer to be fraudulent voidable shall be whether the debtor party's estate subject
	470	+	to administration is insolvent under s. 242.02. For purposes of this subsection, the
	471	+	amount transferred shall be deemed to consist of those assets which the creditors of
	472	+	the debtor party could have made subject to their claims immediately prior to the
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	500	+	SECTION 35
	501	+	SENATE BILL 450
	502	+	transfer, less any sums which such creditors could have made so subject to their
	503	+	claims immediately after the transfer.
	504	+	SECTION 36. 815.18 (10) of the statutes is amended to read:
	505	+	815.18 (10) FRAUDULENT AND VOIDABLE TRANSFERS. A conveyance or transfer of
	506	+	wholly exempt property shall not be considered a fraudulent conveyance or a
	507	+	fraudulent or voidable transfer. Property that is not totally exempt in value under
	508	+	this section may be subject to a fraudulent voidable transfer action under ch. 242 to
	509	+	set aside that transfer to the extent that the property's value is not exempt under this
	510	+	section. If a court is required to satisfy the claim of a creditor and if that relief is
	511	+	demanded, the court may determine the manner of dividing fraudulently transferred
	512	+	property or property for which the transfer is voidable into exempt and nonexempt
	513	+	portions, or may order the sale of the whole property and an accounting of the exempt
	514	+	portion. Any or all of the exemptions granted by this section may be denied if, in the
	515	+	discretion of the court having jurisdiction, the debtor procured, concealed or
	516	+	transferred assets with the intention of defrauding creditors.
	517	+	SECTION 37. 893.425 of the statutes is amended to read:
	518	+	893.425 Fraudulent Voidable transfers and obligations. An action with
	519	+	respect to a fraudulent transfer or obligation under ch. 242 shall be barred unless the
323	520		action is commenced:
324		-	(1) Under s. 242.04 (1) (a), within not later than 4
325		-	years after the transfer is made or the obligation is
326		-	incurred or, if later, within not later than one year after the
327		-	transfer or obligation is or could reasonably have been
328		-	discovered by the claimant.
329		-	(2) Under s. 242.04 (1) (b) or 242.05 (1), within not
330		-	later than 4 years after the transfer is made or the obliga-
331		-	tion is incurred.
332		-	(3) Under s. 242.05 (2), within not later than one year
333		-	after the transfer is made or the obligation is incurred.
	521	+	(1) Under s. 242.04 (1) (a), within not later than 4 years after the transfer is
	522	+	made or the obligation is incurred or, if later, within not later than one year after the
	523	+	transfer or obligation is or could reasonably have been discovered by the claimant.
	524	+	(2) Under s. 242.04 (1) (b) or 242.05 (1), within not later than 4 years after the
	525	+	transfer is made or the obligation is incurred.
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	551	+	SECTION 37 SENATE BILL 450
	552	+	(3) Under s. 242.05 (2), within not later than one year after the transfer is made
	553	+	or the obligation is incurred.
	554	+	(END)
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