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Suing the Recipient

You Can Sue the Person Who Receives the Fraudulently Transferred Property.

If an asset is fraudulently transferred under the Texas UFTA, the creditor may recover judgment for either the value of the asset transferred, or the amount necessary to satisfy the creditor’s claim, whichever is less. If the judgment is based on the value of the asset transferred, the judgment must be for an amount equal to the value of the asset at the time of the transfer, subject to adjustment. However, the value of the asset transferred is not to be adjusted to include the value of improvements made by a good faith transferee, including:

(1) physical additions or changes to the asset;

(2) repairs to the asset;

(3) payment of any tax on the asset;

(4) payment of any debt secured by a lien on the asset that is superior or equal to the rights of a voiding creditor under TUFTA; and

(5) preservation of the asset Tex. Bus. & Com. Code §24.009(c).

A judgment may be entered against either:

1. The first transferee of the asset or the person for whose benefit the transfer was made; or

2. Any subsequent transferee other than a good faith transferee who took for value or from any subsequent transferee.

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