§ 277. Defenses, liability, and protection of transferee or obligee. (a) A transfer or obligation is not voidable under paragraph one of subdivision (a) of section two hundred seventy-three of this article against a person that took in good faith and for a reasonably equivalent value given the debtor or against any subsequent transferee or obligee.(b) To the extent a transfer is avoidable in an action by a creditor under paragraph one of subdivision (a) of section two hundred seventy-six of this article the following rules apply:
(1) Except as otherwise provided in this section, the creditor may recover judgment for the value of the asset transferred, as adjusted under subdivision (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 clause (A) of this subparagraph.
(2) Recovery pursuant to paragraph one of subdivision (a) or subdivision (b) of section two hundred seventy-six of this article of or from the asset transferred or its proceeds, by levy or otherwise, is available only against a person described in subparagraph (i) or (ii) of paragraph one of this subdivision.
(c) If the judgment under subdivision (b) 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.
(d) Notwithstanding voidability of a transfer or an obligation under this article, a good-faith transferee or obligee is entitled, to the extent of the value given the debtor for the transfer or obligation, to:
(1) a lien on or a right to retain an interest in the asset transferred;
(2) enforcement of an obligation incurred; or
(3) a reduction in the amount of the liability on the judgment.
(e) A transfer is not voidable under paragraph two of subdivision (a) of section two hundred seventy-three or section two hundred seventy-four of this article if the transfer results from:
(1) termination of a lease upon default by the debtor when the termination is pursuant to the lease and applicable law; or
(2) enforcement of a security interest in compliance with article nine of the uniform commercial code, other than acceptance of collateral in full or partial satisfaction of the obligation it secures.
(f) A transfer is not voidable under subdivision (b) of section two hundred seventy-four of this article:
(1) 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;
(2) if made in the ordinary course of business or financial affairs of the debtor and the insider; or
(3) 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.
(g) The following rules determine the burden of proving matters referred to in this section:
(1) A party that seeks to invoke subdivision (a), (d), (e) or (f) of this section has the burden of proving the applicability of that subdivision.
(2) Except as otherwise provided in paragraphs three and four of this subdivision, the creditor has the burden of proving each applicable element of subdivision (b) or (c) of this section.
(3) The transferee has the burden of proving the applicability to the transferee of clause (A) or (B) of subparagraph (ii) of paragraph one of subdivision (b) of this section.
(4) A party that seeks adjustment under subdivision (c) of this section has the burden of proving the adjustment.
(h) The standard of proof required to establish matters referred to in this section is preponderance of the evidence.
