How to Defend Against a Claimed
Fraudulent Transfer in NJ if You

Are the Transferee

Under the UFTA, a transferee who innocently received a transfer and paid value for the transferred property is entitled to protection under New Jersey law, with certain conditions.

Innocent Transferees for Value are Entitled to Protection Under the Intent Fraudulent Transfer

If you received property or funds in good faith without knowledge of the fraudulent intent and paid value for what you received (even if the transferor had the intent to hinder, delay or defraud his/her creditors), you are entitled to absolute protection under NJ law and the transfer will not be voidable. 

Legal Protection in New Jersey is Generally Available to All Good Faith Transferees for Value, Down the Line

A good faith transferee for value will always be entitled to some protection under the UFTA.

A creditor who is able to get a judgment for the value of a fraudulently transferred asset against the transferor cannot in NJ enter a judgment against subsequent good-faith transferees for value. A later transferee who receives fraudulently-transferred property from a good-faith subsequent transferee is also protected from a creditor's judgment in New Jersey.

Defenses Available to Insiders

An important defense available to insiders (those close to the transferor) is if the transfer was made pursuant to a good-faith effort to rehabilitate the debtor” and if it "secured present value to the transfer for that purpose and a pre-existing debt of the debtor”.

This defense is very complicated and requires a close factual and economic analysis.