Advice please ref official receiver

oggy47

A friend of mine (who I had a relationship with - now over) has gone into bankruptcy.


During our friendship I helped her out by paying for the holiday we had together with her paying me back gradually and also if she had cash flow problems (ie sudden car repair bill) which she also paid back.


At no time did I know the details of her financial situation and didn't want to (not my concern)


My problem is that the official receiver has sent me a bill for over £2300 for the money she gave to me in the 6 months prior to her going bankrupt.


The relationship ceased over 6 months before her bankruptcy although we remain friends.


How do I stand with this demand? There was no formal agreement just an understanding amongst friends.


Thanks for any advice

fermi

Sounds like they are treating the money paid back to you as a preference.

May be best to carefully read this:

https://www.insolvencydirect.bis.gov.uk/technicalmanual/Ch25-36/Chapter31/part4A/Part%202/Part%202.htm

and

https://www.insolvencydirect.bis.gov.uk/technicalmanual/Ch25-36/Chapter31/part4A/Part%204/Part%204.htm#31.4A.111

One point to perhaps challenge would be whether you can be regarded as an associate under those rules and law, because if you are not then the onus is on the Official Receiver to prove that there was a "desire to prefer" rather than for you to prove there wasn't.

Ultimately though the OR can only enforce such a bill by going to court which you could challenge. They will obviously do their best to persuade you to pay voluntarily though.

debt_doctor

Hi,

A couple of things to add to fermi's post;

Did you agree any regular payments? A contractual (regular) payment can never be a preference. Whilst you will not have had a formal contract, you could argue that if agreed regular payments were being made, then this should be seen in the same light as making contractual regular payments.

The Insolvency Service (IS) appear to be saying that your friend intended to pay you back in an attempt to improve your position in bankruptcy. Was this the case - or was you just being paid back in a regular way?

The second thing is that currently, the IS do not instruct solicitors unless the net gain to the estate is worth more than £5000.

This means they will ASK for it back. You might say "I haven't got it, or the money was paid back fairly". They will undoubtedly claim that they MAY take court action, but...... will they?
DD

fermi

debt_doctor wrote: »

The second thing is that currently, the IS do not instruct solicitors unless the net gain to the estate is worth more than £5000.

I was going to say the same thing, but then I found that had changed.

31.4A.7 No Minimum level of recovery
Clarke Willmott will accept instructions in respect of all antecedent recoveries and there is no minimum amount.

31.4A.8 Conditional fee arrangement
Clarke Willmott will undertake recoveries under the arrangement on a conditional fee basis, meaning that they will undertake legal action at their own risk. Clarke Willmott will pay for the fees and deal with any costs (including adverse costs) associated with bringing a legal action.
Under the agreement, the official receiver will have no liability for costs in the event of an action being unsuccessful.
No fee is payable where no realisation is made and no fee is payable where the action taken against the debtor is unsuccessful. All adverse costs and fees incurred in taking the action will be payable by Clarke Willmott under the conditional fee agreement.

debt_doctor

fermi wrote: »

I was going to say the same thing, but then I found that had changed.

Well done Fermi - how very dare they!
Debt team update on the agenda for work this morning......
DD