Vermont § 7067 - Voidable preferences and liens

§ 7067. Voidable preferences and liens

• (a)(1) A preference is a transfer of any of the property of an insurer to or for the benefit
  of a creditor, for or on account of an antecedent debt, made or suffered by the insurer
  within one year before the filing of a successful petition for liquidation under this
  chapter, the effect of which transfer may be to enable the creditor to obtain a greater
  percentage of this debt than another creditor of the same class would receive. If
  a liquidation order is entered while the insurer is already subject to a rehabilitation
  order, then such transfers shall be deemed preferences if made or suffered within
  one year before the filing of the successful petition for rehabilitation, or within
  two years before the filing of the successful petition for liquidation, whichever
  time is shorter. (2) A preference may be avoided by the liquidator if: (A) the insurer was insolvent at the time of the transfer of property; (B) the transfer of property was made within four months before the filing of the petition; (C) the creditor receiving it or to be benefited by it or the creditor’s agent acting
  with reference to it had, at the time when the transfer of property was made, reasonable
  cause to believe that the insurer was insolvent or was about to become insolvent;
  or (D) the creditor receiving transferred property was an officer, or any employee or attorney
  or other person who was in fact in a position of comparable influence in the insurer
  to an officer whether or not he or she held such position, or any shareholder holding
  directly or indirectly more than five per centum of any class of any equity security
  issued by the insurer, or any other person, firm, corporation, association, or aggregation
  of persons with whom the insurer did not deal at arm’s length. (3) Where the preference is voidable, the liquidator may recover the property or, if it
  has been converted, its value from any person who has received or converted the property;
  except where a bona fide purchaser or lienor has given less than fair equivalent value,
  the purchaser or lienor shall have a lien upon the property to the extent of the consideration
  actually given by the purchaser or lienor. Where a preference by way of lien or security
  title is voidable, the court may on due notice order the lien or title to be preserved
  for the benefit of the estate, in which event the lien or title shall pass to the
  liquidator. (4) Notwithstanding subdivision (2) of this subsection, or any other provision of this
  chapter to the contrary, no receiver or any other person shall avoid any preference
  arising under or in connection with any pledge, security, credit, collateral, loan,
  advances, reimbursement, or guarantee agreement or arrangement, or any similar agreement,
  arrangement, or other credit enhancement to which a federal home loan bank, as defined
  in section 7033 of this title, is a party. (b)(1) A transfer of property other than real property shall be deemed to be made or suffered
  when it becomes so far perfected that no subsequent lien obtainable by legal or equitable
  proceedings on a simple contract could become superior to the rights of the transferee. (2) A transfer of real property shall be deemed to be made or suffered when it becomes
  so far perfected that no subsequent bona fide purchaser from the insurer could obtain
  rights superior to the rights of the transferee. (3) A transfer that creates an equitable lien shall not be deemed to be perfected if there
  are available means by which a legal lien could be created. (4) 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. (5) The provisions of this subsection apply whether or not there are or were creditors
  who might have obtained liens or persons who might have become bona fide purchasers. (c)(1) A lien obtainable by legal or equitable proceedings upon a simple contract is one
  arising in the ordinary course of such proceedings upon the entry or docketing of
  a judgment or decree, or upon attachment, garnishment, execution, or like process,
  whether before, upon, or after judgment or decree and whether before or upon levy.
  It does not include liens that under applicable law are given a special priority over
  other liens that are prior in time. (2) A lien obtainable by legal or equitable proceedings could become superior to the rights
  of a transferee, or a purchaser could obtain rights superior to the rights of a transferee
  within the meaning of subsection