Bulk sales legislation came into place to prevent the fraudulent practice of selling the entire inventory of a farm or a store in order to defeat the claims of creditors who would otherwise be able to seize the goods to satisfy a debt.
Under traditional fraudulent conveyance law, such a sale was not void against creditors unless it was made in bad faith for insufficient consideration.
However, if it attempted to sell all its cars to a single buyer, this would be considered a bulk sale, as it is not something an auto dealer would generally do in the normal course of business.
Bulk transfers in the United States (U.S.) were generally governed by Article 6 of the Uniform Commercial Code (UCC).
However, Article 6 has now been repealed by most states,[2][3] in favor of revisions to other provisions of the UCC that apply to sales and secured transactions.