Opinion ID: 1211468
Heading Depth: 4
Heading Rank: 1

Heading: Insolvency

Text: This Court has established the propriety of the balance sheet test for insolvency. First National Bank, 97 N.M. at 292, 639 P.2d at 579. Here the trial court found that Arrow had a net worth in April, 1982 of $1,637,934. Subtracting the $1,000,000 debt to Voldens left a net worth of $537,934. Plaintiffs contend instead that the fair market value of Arrow's assets was close to the $879,360.50 gross proceeds from the auction sale. The court found, however, that the auction, due to its forced sale nature whose terms were without reserve, did not reflect the fair salable value of Arrow's assets at the time of their transfer to Wards. Substantial evidence supports the finding that Arrow was not insolvent.