PJC Business

PJC 105.28

F RAUD AND N EGLIGENT M ISREPRESENTATION

PJC 105.28 Question on Constructive Fraud—Transfer to Insider (Tex. Bus. & Com. Code § 24.006(b)) QUESTION ______ Did Dean Debtor transfer any of the assets listed below to an insider for a debt that existed prior to the alleged transfer, at a time when Dean Debtor was insolvent and the insider had reasonable cause to believe that Dean Debtor was insolvent? [Insert instructions, if appropriate.] Answer “Yes” or “No” for each asset listed below. 1. [ Asset 1. ] Answer: _______________ 2. [ Asset 2. ] Answer: _______________ 3. [ Asset 3. ] Answer: _______________ COMMENT When to use. PJC 105.28 should be used when the plaintiff alleges that a transfer was made to an insider for a preexisting debt when the debtor was insolvent and the insider had reasonable cause to believe that the debtor was insolvent. See Tex. Bus. & Com. Code § 24.006(b). Broad-form submission. PJC 105.28 is a broad-form question designed to be accompanied by one or more appropriate instructions. Tex. R. Civ. P. 277 requires that “the court shall, whenever feasible, submit the cause upon broad-form questions.” Tex. R. Civ. P. 277; see Thota v. Young , 366 S.W.3d 678, 689 (Tex. 2012) (rule 277’s use of “whenever feasible” mandates broad-form submission in any or every instance in which it is capable of being accomplished). For further discussion, see PJC 116.2 regarding broad-form issues and the Casteel doctrine. Source of question. The question is based on Tex. Bus. & Com. Code § 24.006(b). Debtor and creditor. If there is a factual dispute regarding the status of a perti nent person or entity as a debtor or creditor, a predicate question should be submitted

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