Consequences of Bankruptcy

At_Wits_End_2

Hi There,

I have just today been made bankrupt for a debt that was nothing to do with me. An ex fraudulent business partner of mine took out two Hp agreements on equipment without my knowledge but used myself as a guarantee. I personally have never given my consent to being a guarantee or signed documentation Although documents appear to have been fraudulently signed. I have proof i wasn't even in the country when this happened.

The matter was passed to the police who are investigating although taking their time over it. This however never stopped a judge this morning making me bankrupt even pointing out he hoped he hadn't made a huge injustice but saying the police involvement wasn't enough and that and that the time scales in which this has been going on meant some closure had to be gained.

This has shocked me massively and i would welcome any advice on what happens next and where i go from here. Is my home at risk? even though my partner has an interest in the home and we have a young daughter. I have no other assets as i lost them all when the company i was involved in went into administration through my partners dishonest ways. I need to move forward but at present can't see the woods through the trees, i am also extremely worried about losing the family home.

I have read some of the leaflets available on line but would like someone to put it into laymens terms for me to understand!

debt_doctor

Hi,


A few questions (to start with)


1) how much equity in your home?
2) Is it joint or solely owned?
3) have you taken any advice up to now?
4) What was the amount of debt?
5) Who is the creditor?
6) Are you working?
7) Did you apply to have the stat demand set aside or the petition set aside?
8) Does the creditor have a CCJ in respect of this debt?


If you want to try and stop this, you need to move very, very fast.


DD

At_Wits_End_2

Hi Debt Doctor,

Thanks for your reply i have answered your questions below:-

1) how much equity in your home?
Not sure exactly how much equity but approx 35-50k

2) Is it joint or solely owned?
the property is solely in my name but i have been with my partner for 17 years and she does pay a couple of bills. We do have an 11 year old daughter.

3) have you taken any advice up to now?
I was using a solicitor with the case but he wasn't much use just cost a lot of money i had to borrow to pay with.

4) What was the amount of debt?
With costs etc 90k

5) Who is the creditor?
Lombard Finance

6) Are you working?
Yes i'm self employed

7) Did you apply to have the stat demand set aside or the petition set aside?
We applied for the petition to be set aside but were to late for the stat demand as by the time i got to see the solicitor and he told me what to do the 18 days had passed

8) Does the creditor have a CCJ in respect of this debt?
Yes he has a CCJ. We did contest the original case but my defence arrived at court 1 day late even though it was posted recorded delivery. My solicitor then set about getting the judgement set-aside by firstly out of courtesy approaching the oppositions solicitors advising our intentions and seeking their approval but after 3 months and 3 letters had not received a reply. My solicitor then advised me that as the other solicitors weren't responding i should hang tight as they didn't seem to be enforcing the judgement. However this was poor advice as 11 months down the line they then served the stat demand. I applied to the court for a stay of execution under the grounds it was not my debt and i had proof that i couldn't have signed one of the agreements as i was not in the country. Even explaining that i had contacted the fraud squad and obtained a case number with which they would be investigating but still i was today made bankrupt.

debt_doctor

Your solicitor sounds negligent. You don't leave a £90k debt hanging for 3 months to see if the other side might just agree to a set aside - you pay £80 to the court and do it.
The fact is that the court had already decided you owed the money, your defence was out of time. An immediate set aside should have been applied for.
Not only would you need to set aside the bankruptcy order, but set aside the CCJ too - and I'm afraid that is a very tall order indeed. Both need to be made in 'good time' - for the CCJ I suggest you are far too late, and a bankruptcy needs a set aside in a day or two, otherwise you would have to go for annulment which is far more costly.
I believe the correct approach (as soon as you became aware of a problem, before court action) would have been to make a formal complaint against Lombard Finance, present your evidence and then refer to FOS for them to adjudicate and provide their binding decision.
I hate to lay this all out to you after the event, but the entire process was a failure from start to finish, at god knows what cost for the 'professional' help.


Unless someone can provide an amount of money to cover your 'beneficial interest' in the property - and the starting assumption will be that all the equity is yours - your partner would have to prove any potential interest she has - then the property will be sold to free up the cash in the property.
Because of home rights, you can delay the property sale for a year. If you have surplus income from your self employment, this will be the subject of monthly payments for 3 years.


DD

arcon5

You need to contact a solicitor ASAP - a decent one and try to fight the bankruptcy order.

As with significant equity you are at risk of having your home repossessed now!

roger196

At_Wits_End wrote: »

Hi There,

I have just today been made bankrupt for a debt that was nothing to do with me. An ex fraudulent business partner of mine took out two Hp agreements on equipment without my knowledge but used myself as a guarantee. QUOTE]

I may be out of date in this area, in which case someone will put me right. So my advice needs to be checked before taking any action.

When you are in partnership, you are liable for all the debts of the partnership, not just those incurred by yourself. Each partner has the authority to bind the partnership. Are you claiming that the debts were incurred AFTER the partnership ceased.
In what way was the business partner fraudulent?
It seem strange that the police have not followed matters up. Have you sought an informal review with a senior officer. Ask for their complaints procedure.
What instructions were given to the firm of solicitors.Were they told to write one letter or were they engaged to see the matter to a satisfactory conclusion. There is normally a "letter of engagement" which will set out the terms under which they act.