Section 6.9 Insolvency

• Library: Bankruptcy Practice (2007 Ed. + 2015 Cum Supp)

D. (§6.9) Insolvency

Under 11 U.S.C. § 547(f), a rebuttable presumption exists that the debtor was insolvent on and during the 90 days preceding the bankruptcy petition. The defending creditor may present evidence to rebut or meet the presumption, but the burden of persuasion remains with the debtor. Clay v. Traders Bank of Kansas City, 708 F.2d 1347, 1351 (8^th Cir. 1983). The Eighth Circuit only requires some evidence, not substantial evidence, of solvency to offset the presumption of insolvency. Id. A financial statement showing positive net worth is sufficient to rebut the presumption of insolvency. See Jones Truck Lines, Inc. v. Full Serv. Leasing Corp., 83 F.3d 253, 258 (8^th Cir. 1996); In re Payless Cashways, Inc., 290 B.R. 689, 698 (Bankr. W.D. Mo. 2003) (Federman, C.J.).

“[I]nsolvent” is defined in the Bankruptcy Code as a “financial condition such that the sum of such entity’s debts is greater...