insolvency

insolvency
The condition of a person or business that is insolvent; inability or lack of means to pay debts. Such a relative condition of a person's or entity's assets and liabilities that the former, if all made immediately available, would not be sufficient to discharge the latter. Under bankruptcy law, the condition of a person or firm that is unable to pay debts as they fall due, or in the usual course of trade or business. Financial condition such that businesses' or person's debts are greater than aggregate of such debtor's property at a fair valuation. American Nat. Bank & Trust Co. of Chicago, 111. v. Bone, C.A.MO., 333 F.2d 984, 987.
In general, state insolvency laws have been superseded by the Federal Bankruptcy Code (11 U.S.C.A.).
"Insolvency" under the Bankruptcy Code is defined in No. 101.
"Technical" insolvency is a situation in which a firm is unable to meet its current obligations as they come due, even though the value of its assets may exceed its liabilities. Under U.C.C., a person is insolvent who either has ceased to pay his debts in the ordinary course of business or cannot pay his debts as they fall due or is insolvent within the meaning of the Federal Bankruptcy Law. U.C.C. No. 1-201(23)
@ insolvency proceeding
Any proceeding intended to liquidate or rehabilitate the estate of the person involved, including any assignment for the benefit of creditors and any chapter proceeding under federal bankruptcy law. U.C.C. No. 1-201(22).
@

Black's law dictionary. . 1990.

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  • Insolvency — means the inability to pay one s debts as they fall due. Usually used to refer to a business, insolvency refers to the inability of a company to pay off its debts. Business insolvency is defined in two different ways: Cash flow insolvency Unable… …   Wikipedia

  • insolvency — in·sol·ven·cy /in säl vən sē/ n pl cies 1: the fact or state of being insolvent compare bankruptcy 2: insufficiency (as of an estate) to discharge all enforceable debts ◇ Insolvency matters are covered under the Bankruptcy Code. Merriam …   Law dictionary

  • Insolvency — In*sol ven*cy, n.; pl. {Insolvencies}. (Law) (a) The condition of being insolvent; the state or condition of a person who is insolvent; the condition of one who is unable to pay his debts as they fall due, or in the usual course of trade and… …   The Collaborative International Dictionary of English

  • insolvency — (see also bankruptcy and failure) another term used to describe a firm that is failing; generally it means that a firm s liabilities exceed its assets or that it is unable to satisfy its obligations as they come due. (Common Bankruptcy Terms)… …   Glossary of Bankruptcy

  • insolvency — 1660s; see INSOLVENT (Cf. insolvent) + CY (Cf. cy). Insolvence (1793) is rare …   Etymology dictionary

  • insolvency — [in säl′vən sē] n. pl. insolvencies the fact or condition of being insolvent; bankruptcy …   English World dictionary

  • insolvency — The lack of adequate capital. The condition that exists when the amount of losses exceeds the amount of capital. See solvency and solvency risk. American Banker Glossary This occurs when individuals or businesses do not have enough assets to… …   Financial and business terms

  • insolvency — /in sol veuhn see/, n. the condition of being insolvent; bankruptcy. [1650 60; INSOLV(ENT) + ENCY] * * * Condition in which liabilities exceed assets so that creditors cannot be paid. It is a financial condition that often precedes bankruptcy. In …   Universalium

  • insolvency — The insufficiency of the entire property and assets of an individual to pay his debts. 29 Am J Rev ed Insolv § 2. In a practical commercial sense, the inability of a person to pay his debts as they become due in the ordinary course of his… …   Ballentine's law dictionary

  • Insolvency — When an individual or organization can no longer meet its financial obligations with its lender or lenders as debts become due. Insolvency can lead to insolvency proceedings, in which legal action will be taken against the insolvent entity, and… …   Investment dictionary

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