(a)  A debtor is insolvent if, at a fair valuation, the sum of the debtor’s debts is greater than the sum of the debtor’s assets.

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Terms Used In Rhode Island General Laws 6-16-2

  • Asset: means property of a debtor, but the term does not include:

    (i)  Property to the extent it is encumbered by a valid lien;

    (ii)  Property to the extent it is generally exempt under nonbankruptcy law; or

    (iii)  An interest in property held in tenancy by the entireties to the extent it is not subject to process by a creditor holding a claim against only one tenant. See Rhode Island General Laws 6-16-1

  • 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 Rhode Island General Laws 6-16-1
  • Property: means anything that may be the subject of ownership. See Rhode Island General Laws 6-16-1
  • 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, license, and creation of a lien or other encumbrance. See Rhode Island General Laws 6-16-1

(b)  A debtor who is generally not paying the debtor’s debts as they become due other than as a result of a bona fide dispute is presumed to be insolvent. The presumption imposes on the party against whom the presumption is directed the burden of proving that the nonexistence of insolvency is more probable than its existence.

(c)  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 have been transferred in a manner making the transfer voidable under this chapter.

(d)  Debts under this section do not include obligations to the extent they are secured by a valid lien on property of the debtor not included as an asset.

History of Section.
P.L. 1986, ch. 438, § 2; P.L. 2014, ch. 528, § 14; P.L. 2018, ch. 141, § 2; P.L. 2018, ch. 236, § 2.