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Solvent or Insolvent



The issue of solvency, and insolvency, frequently arises in bankruptcy matters where a claim is made that one party (the debtor) made a transfer (while insolvent, or which transfer caused insolvency) with the intent to hinder, delay or defraud a creditor. Of course, the debtor typically claims that the transfer was made in good faith in the ordinary course of business for consideration of a reasonably equivalent value. At law, the solvency, or lack thereof, of the debtor is an economic question. Also in question is whether the transfer caused, or contributed to, the alleged insolvency or actual insolvency. All told, the question of insolvency, coupled with the appropriateness of.