Arizona Laws 44-1002. Insolvency
A. A debtor is insolvent if the sum of the debtor’s debts is greater than all of the debtor’s assets at a fair valuation.
Terms Used In Arizona Laws 44-1002
- Asset: means property of a debtor, but asset does not include any of the following:
(a) Property to the extent it is encumbered by a valid lien. See Arizona Laws 44-1001
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Debtor: means a person who is liable on a claim. See Arizona Laws 44-1001
- Equitable: Pertaining to civil suits in "equity" rather than in "law." In English legal history, the courts of "law" could order the payment of damages and could afford no other remedy. See damages. A separate court of "equity" could order someone to do something or to cease to do something. See, e.g., injunction. In American jurisprudence, the federal courts have both legal and equitable power, but the distinction is still an important one. For example, a trial by jury is normally available in "law" cases but not in "equity" cases. Source: U.S. Courts
- including: means not limited to and is not a term of exclusion. See Arizona Laws 1-215
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
- Property: means anything that may be the subject of ownership. See Arizona Laws 44-1001
- Transfer: means every mode, direct or indirect, absolute or conditional, voluntary or involuntary, of disposing of or parting with an asset or an interest in an asset and includes payment of money, release, lease and creation of a lien or other encumbrance. See Arizona Laws 44-1001
B. A debtor who is generally not paying his debts as they become due is presumed to be insolvent.
C. A partnership is insolvent under subsection A if the sum of the partnership’s debts is greater than the aggregate, at a fair valuation, of all of the partnership’s assets and the sum of the excess of the value of each general partner’s nonpartnership assets over the partner’s nonpartnership debts.
D. Assets under this section do not include property that has been transferred, concealed or removed with intent to hinder, delay or defraud creditors or that has been transferred in a manner making the transfer voidable under this article.
E. Debts under this section do not include an obligation to the extent it is secured by a valid lien on property of the debtor not included as an asset.
F. Debts under this section include the full amount of the debtor’s potential liability under contracts of guarantee and surety. The assets of the debtor shall include a fair valuation of the rights of the debtor in connection with the contracts under indemnity or similar agreements and under equitable principles, including contribution and subrogation.