Revised Code of Washington

Wash. Rev. Code § 19.40.081 (2026)

Defenses, liability, and protection of transferee

✓ current as of May 2026

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(1) A transfer or obligation is not voidable under RCW 19.40.041(1) or 19.40.051(1) against a person that took in good faith and for a reasonably equivalent value whether or not given to the debtor or against any subsequent transferee or obligee.

(2) To the extent a transfer is avoidable in an action by a creditor under RCW 19.40.071(1)(a), the following rules apply:

(a) Except as otherwise provided in this section, the creditor may recover judgment for the value of the asset transferred, as adjusted under subsection (c) of this section, or the amount necessary to satisfy the creditor's claim, whichever is less. The judgment may be entered against:

(i) The first transferee of the asset or the person for whose benefit the transfer was made; or

(ii) An immediate or mediate transferee of the first transferee, other than:

(A) A good-faith transferee that took for value; or

(B) An immediate or mediate good-faith transferee of a person described in (a)(ii)(A) of this subsection.

(b) Recovery pursuant to RCW 19.40.071 (1)(a) or (2) or from the asset transferred or its proceeds, by levy or otherwise, is available only against a person described in (a)(i) or (ii) of this subsection.

(3) If the judgment under subsection (2) of this section is based upon 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 as the equities may require.

(4) Notwithstanding voidability of a transfer or an obligation under this chapter, a good-faith transferee or obligee is entitled, to the extent of the value given the debtor for the transfer or obligation, to:

(a) A lien on or a right to retain an interest in the asset transferred;

(b) Enforcement of an obligation incurred; or

(5) A transfer is not voidable under RCW 19.40.041(1)(b) or 19.40.051 if the transfer results from:

(a) Termination of a lease upon default by the debtor when the termination is pursuant to the lease and applicable law; or

(b) Enforcement of a security interest in compliance with Article 9A of Title 62A RCW, other than acceptance of collateral in full or partial satisfaction of the obligation it secures.

(6) A transfer is not voidable under RCW 19.40.051(2):

(a) To the extent the insider gave new value to or for the benefit of the debtor after the transfer was made, except to the extent the new value was secured by a valid lien;

(b) If made in the ordinary course of business or financial affairs of the debtor and the insider; or

(c) If made pursuant to a good faith effort to rehabilitate the debtor and the transfer secured present value given for that purpose as well as an antecedent debt of the debtor.

(7) The following rules determine the burden of proving matters referred to in this section:

(a) A party that seeks to invoke subsection (1), (4), (5), or (6) of this section has the burden of proving the applicability of that subsection.

(b) Except as otherwise provided in (c) and (d) of this subsection, the creditor has the burden of proving each applicable element of subsection (2) or (3) of this section.

(c) The transferee has the burden of proving the applicability to the transferee of subsection (2)(a)(ii)(A) or (B) of this subsection.

(d) A party that seeks adjustment under subsection (3) of this section has the burden of proving the adjustment.

(8) The standard of proof required to establish matters referred to in this section is preponderance of the evidence.

[ 2017 c 57 s 8; 2001 c 32 s 1; 1987 c 444 s 8.]

Notes:

Effective date—2001 c 32: See note following RCW 62A.9A-102.

Effective date—1987 c 444: See note following RCW 19.40.011.

Notes of Decisions

Cited in 29 cases (10 in the last 5 years), 1991–2025 · leading case: Thompson v. Hanson, 239 P.3d 537 (Wash. 2009).

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Thompson v. Hanson, 239 P.3d 537 (Wash. 2009). · cites it 15× “041(a)(1) against a person who took in good faith and for a reasonably equivalent value or against any subsequent transferee or obligee. (b) Except as otherwise provided in this section, to the extent a transfer is voidable in an action by a creditor under RCW 19.”

Thompson v. Hanson, 174 P.3d 120 (Wash. Ct. App. 2007). · cites it 13× “But based on the determination that the Thompsons proved the transfer of Lots 66 and 68 was constructive fraud, the court concluded the Thompsons were entitled to judgment against the Hansons under RCW 19.40.081 to the extent of the $100,000 in equity that they received from the…”

Thompson v. Hanson, 142 Wash. App. 53 (Wash. Ct. App. 2007). · cites it 10× “But based on the determination that the Thompsons proved the transfer of lots 66 and 68 was constructive fraud, the court concluded the Thompsons were entitled to judgment against the Hansons under RCW 19.40.081 to the extent of the $100,000 in equity that they received from the…”

Thompson v. Hanson, 219 P.3d 659 (Wash. 2009). · cites it 13× “(b) Except as otherwise provided in this section, to the extent a transfer is voidable in an action by a creditor under RCW 19.”

Calvert v. Erdman (In re Nw. Territorial Mint, LLC), 591 B.R. 852 (Bankr. W.D. Wash. 2018). · cites it 12× “The avoidance, however, is subject to RCW § 19.40.081. Id. Under that latter statute, a creditor may recover judgment for the value of the asset transferred, as adjusted under subsection (c) of this section, or the amount necessary to satisfy the creditor's claim, whichever is…”

Thompson v. Hanson, 239 P.3d 537 (Wash. 2010). · cites it 14× “(b) Except as otherwise provided in this section, to the extent a transfer is voidable in an action by a creditor under RCW 19.”

Eagle Pac. Ins. v. Christensen Motor Yacht Corp., 934 P.2d 715 (Wash. Ct. App. 1997). · cites it 4× “RCW 19.40.081(b). Here, it is undisputed that CGI and CSL were first transferees.”

Lacey Marketplace Assocs. II, LLC v. United Farmers of Alberta Coop. Ltd., 107 F. Supp. 3d 1155 (W.D. Wash. 2015). · cites it 8× “’s (“Sportsman”) “Motion for Entry of Judgment on Plaintiffs’ Fraudulent Transfer Claims under RCW 19.40.081(b).” (Mot. (Dkt. # 188).) The court has considered the motion, all submissions filed in support of and opposition to the motion, the balance of the record, and the…”

Assocs. Hous. Fin. v. Stredwick, 83 P.3d 1032 (Wash. Ct. App. 2004). · cites it 5× “In any action for relief against a fraudulent transfer, the creditor, subject to certain limitations described in RCW 19.40.081, [5] may avoid the transfer to the extent necessary to satisfy the creditor's claim, or may attach the asset or enjoin further disposition of the asset…”

Calvert v. Radford (In re Consol. Meridian Funds), 487 B.R. 263 (Bankr. W.D. Wash. 2013). · cites it 6× “RCW 19.40.081. With the foregoing federal and state statutory framework for avoidance of fraudulent conveyances in mind, the Court turns to the defenses raised by Sun Granite which are found in Section 548(c) and RCW 19.”

Carbon v. Spokane Closing & Escrow, Inc., 147 P.3d 605 (Wash. Ct. App. 2006). · cites it 3× “RCW 19.40.081(b). A&P quitclaimed the Grove property to Carport just prior to trial.”

Glimcher Supermall Venture, LLC v. Coleman Co., 2007 SD 98 (S.D. 2007). · cites it 2× “071 provides: (a) In an action for relief against a transfer or obligation under this chapter, a creditor, subject to the limitations in RCW 19.40.081, may obtain: (1) Avoidance of the transfer or obligation to the extent necessary to satisfy the creditor's claim; (2) An…”

Show all 29 citing cases →

— Wash. Rev. Code § 19.40.081(1) — 2 cases

Milwaukee Avenue, Llc, V. Ted Spice (Wash. Ct. App. 2021).

Kenneth Wren, et ux. v. Stanford & Sons, LLC (Wash. Ct. App. 2025).

— Wash. Rev. Code § 19.40.081(2) — 1 case

Kenneth Wren, et ux. v. Stanford & Sons, LLC (Wash. Ct. App. 2025).

— Wash. Rev. Code § 19.40.081(2)(a) — 5 cases

Milwaukee Avenue, Llc, V. Ted Spice (Wash. Ct. App. 2021).

Apex Energy Solutions of Seattle LLC v. Foit (W.D. Wash. 2024).

Vaughn v. Cohen (W.D. Wash. 2024).

Vaughn v. Cohen (W.D. Wash. 2025).

Apex Energy Solutions of Seattle LLC v. Foit (W.D. Wash. 2025).

— Wash. Rev. Code § 19.40.081(a) — 9 cases

Thompson v. Hanson, 239 P.3d 537 (Wash. 2009). “041(a)(1) against a person who took in good faith and for a reasonably equivalent value or against any subsequent transferee or obligee. (b) Except as otherwise provided in this section, to the extent a transfer is voidable in an action by a creditor under RCW 19.”

Calvert v. Radford (In re Consol. Meridian Funds), 487 B.R. 263 (Bankr. W.D. Wash. 2013). “RCW 19.40.081. With the foregoing federal and state statutory framework for avoidance of fraudulent conveyances in mind, the Court turns to the defenses raised by Sun Granite which are found in Section 548(c) and RCW 19.”

Thompson v. Hanson, 219 P.3d 659 (Wash. 2009). “(b) Except as otherwise provided in this section, to the extent a transfer is voidable in an action by a creditor under RCW 19.”

Assocs. Hous. Fin. v. Stredwick, 83 P.3d 1032 (Wash. Ct. App. 2004). “In any action for relief against a fraudulent transfer, the creditor, subject to certain limitations described in RCW 19.40.081, [5] may avoid the transfer to the extent necessary to satisfy the creditor's claim, or may attach the asset or enjoin further disposition of the asset…”

Ralph Janvey v. Golf Channel, Inc., 780 F.3d 641 (5th Cir. 2015).

— Wash. Rev. Code § 19.40.081(b) — 10 cases

Eagle Pac. Ins. v. Christensen Motor Yacht Corp., 934 P.2d 715 (Wash. Ct. App. 1997). “RCW 19.40.081(b). Here, it is undisputed that CGI and CSL were first transferees.”

Lacey Marketplace Assocs. II, LLC v. United Farmers of Alberta Coop. Ltd., 107 F. Supp. 3d 1155 (W.D. Wash. 2015). “’s (“Sportsman”) “Motion for Entry of Judgment on Plaintiffs’ Fraudulent Transfer Claims under RCW 19.40.081(b).” (Mot. (Dkt. # 188).) The court has considered the motion, all submissions filed in support of and opposition to the motion, the balance of the record, and the…”

Calvert v. Erdman (In re Nw. Territorial Mint, LLC), 591 B.R. 852 (Bankr. W.D. Wash. 2018). “The avoidance, however, is subject to RCW § 19.40.081. Id. Under that latter statute, a creditor may recover judgment for the value of the asset transferred, as adjusted under subsection (c) of this section, or the amount necessary to satisfy the creditor's claim, whichever is…”

Thompson v. Hanson, 219 P.3d 659 (Wash. 2009). “(b) Except as otherwise provided in this section, to the extent a transfer is voidable in an action by a creditor under RCW 19.”

— Wash. Rev. Code § 19.40.081(b)(1) — 9 cases

Thompson v. Hanson, 174 P.3d 120 (Wash. Ct. App. 2007). “But based on the determination that the Thompsons proved the transfer of Lots 66 and 68 was constructive fraud, the court concluded the Thompsons were entitled to judgment against the Hansons under RCW 19.40.081 to the extent of the $100,000 in equity that they received from the…”

Thompson v. Hanson, 142 Wash. App. 53 (Wash. Ct. App. 2007). “But based on the determination that the Thompsons proved the transfer of lots 66 and 68 was constructive fraud, the court concluded the Thompsons were entitled to judgment against the Hansons under RCW 19.40.081 to the extent of the $100,000 in equity that they received from the…”

Thompson v. Hanson, 219 P.3d 659 (Wash. 2009). “(b) Except as otherwise provided in this section, to the extent a transfer is voidable in an action by a creditor under RCW 19.”

— Wash. Rev. Code § 19.40.081(c) — 8 cases

Eagle Pac. Ins. v. Christensen Motor Yacht Corp., 934 P.2d 715 (Wash. Ct. App. 1997). “RCW 19.40.081(b). Here, it is undisputed that CGI and CSL were first transferees.”

Thompson v. Hanson, 219 P.3d 659 (Wash. 2009). “(b) Except as otherwise provided in this section, to the extent a transfer is voidable in an action by a creditor under RCW 19.”

Thompson v. Hanson, 239 P.3d 537 (Wash. 2010). “(b) Except as otherwise provided in this section, to the extent a transfer is voidable in an action by a creditor under RCW 19.”

— Wash. Rev. Code § 19.40.081(d) — 8 cases

Thompson v. Hanson, 219 P.3d 659 (Wash. 2009). “(b) Except as otherwise provided in this section, to the extent a transfer is voidable in an action by a creditor under RCW 19.”

Thompson v. Hanson, 239 P.3d 537 (Wash. 2010). “(b) Except as otherwise provided in this section, to the extent a transfer is voidable in an action by a creditor under RCW 19.”

— Wash. Rev. Code § 19.40.081(d)(1) — 1 case

Carbon v. Spokane Closing & Escrow, Inc., 147 P.3d 605 (Wash. Ct. App. 2006). “RCW 19.40.081(b). A&P quitclaimed the Grove property to Carport just prior to trial.”

— Wash. Rev. Code § 19.40.081(d)(3) — 5 cases

Thompson v. Hanson, 219 P.3d 659 (Wash. 2009). “(b) Except as otherwise provided in this section, to the extent a transfer is voidable in an action by a creditor under RCW 19.”

Thompson v. Hanson, 239 P.3d 537 (Wash. 2010). “(b) Except as otherwise provided in this section, to the extent a transfer is voidable in an action by a creditor under RCW 19.”

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