Rent arrears from years ago

m8nd1

Dear all,

Made bankrupt 3/9 and have applied to council for housing as likely to lose home. Got letter back today saying that they have provisionally accepted my application, but they have a debt in my name of £350. I don't know what this is for but I did live in the area about 13 years ago and ended up getting evicted so it may well be that.

Is there a life span on debt that they can chase me for, and if not - does this get taken into the bankruptcy proceedings? They say they won't put me on the list until the debt is cleared or I have started making a repayment arrangement (am I right in thinking if I did this, I'd be giving a creditor preferential treatment?)

Any help gratefully received..

fermi

Assuming it is rent arrears, as far as I know this debt should be included in the bankruptcy.

The important thing is to find out as soon as you can the precise nature of the debt, so that you can provide full details to your OR. Then they can tell you your position for certain.

Your OR won't mind you adding in a debt that was unknown or forgotten about, and if it can be included in the BR they will write to the council/etc saying that the debt is included and that you should no longer be asked to repay it.

rog2

The 'debt' would have been included in your bankruptcy - whether you declared it or not.
In any case, a debt of that age would, by now, have become statute barred, providing you had not paid anything towards it, or acknowledged it in writing, and once you tell the creditor that you do not intend to pay it, because it is statute barred, they can no longer pursue you, through the courts, for recovery.
That said, I would suggest that you inform the council of your bankruptcy - date and case no. - and tell them that, whilst you do not acknowledge any outstanding debt to them, they should contact the Insolvency Service, who will clarify the legal position of this 'alleged debt'.
I also think it advisable to have a word with CAB - they know more about local council housing policies and will be able to point you in the right direction.

wherediditallgo

rog2 wrote: »

That said, I would suggest that you inform the council of your bankruptcy - date and case no. - and tell them that, whilst you do not acknowledge any outstanding debt to them, they should contact the Insolvency Service, who will clarify the legal position of this 'alleged debt'.
I also think it advisable to have a word with CAB - they know more about local council housing policies and will be able to point you in the right direction.

Rog makes a good point here. Even if the debt wasn't covered by the bankruptcy, it would be statute barred by now as long as no acknowledgement of the debt or payment towards it had taken place in the last six years.

However, the fact the OP did go BR may affect the housing application and the way the rent account is administered by the council. My council told me that, while they've never evicted an existing tenant who goes BR owing them money, their BR status would have to be recorded & declared if they wanted to move, e.g. through a housing transfer either within the borough or to a property in another borough. The rent account was likely to be monitored more closely because previous arrears had not been paid. Councils don't act in a uniform way though, so it's better to declare it & know where you stand from the beginning. Housing associations operate differently from councils, & from what I've read are much more likely not to wipe out arrears & seem quicker to go down the court route if the arrears aren't cleared against an existing payment agreement. Out of the two, I'd say the council was your better bet.

fermi

One big problem with 'Statute Barred' debts is that although they are no longer enforceable through the courts they are still legally owed (so I hesitated to mention the 'Limitation Act' initially). I don't think the council or housing association would be particularly sympathetic to a new applicant claiming an old debt as 'Statute Barred' either.

However the debt should be covered by the BR (and must be treated accordingly) so with a bit of luck the council/association will just accept it as something that nothing can be done about, and not penalise the OP.

gratton20

Like everyone says, the debt should be included in your BR and statue barred. I am not sure that is the problem. Given that you did owe the council some money, (assuming they can prove you did and that it is not a mistake) it may be their policy that although they cannot recover it they will not put you on their housing list because of it. It may be their policy not to accept people who owe them money, irrespective of the legal issue about getting the money back. If you fall into a priority group they may by law HAVE to house you .. if not then your legal rights vis a vis housing may be different .. a housing advice agency could help, or CAB

You need to get the council to give you detailed info - what is the debt for? Rent, council tax, or maybe a service they provided like taking away bulk rubbish or something.

rog2

fermi wrote: »

I don't think the council or housing association would be particularly sympathetic to a new applicant claiming an old debt as 'Statute Barred' either.

But that applicant (m8) would be entitled to do so, and did ask the question 'is there a life span on debt, that they can chase me for'.

However, in the Op's case, the Limitations Act SHOULD be irrelevant as bankruptcy has 'intervened' so to speak.
I notice that m8nd1 was only declared bankrupt on the 3rd of September, so in all probability his/her bankruptcy has not yet shown up on any searches that the council would have made.
I suggest that, in specific regard to this 'alleged debt' the OP informs the council of his/her bankruptcy date, court and case number, as the council will need to pursue this alleged debt through the OR. To attempt to pursue it, directly from OP, would, indeed, be seen as attempting to obtain preferential creditor status, whatever the original debt was for.
I am unaware of any council policies that would 'exclude' bankrupts from registering on the housing register, or indeed getting a council tenancy. This may be the case, but if it is, I would question the legality of such a clause and the effect that it would have on a council's obligation to provide housing for genuinely homeless applicants.
As I am not, nor do I profess to be, fully cognisant of the 'workings' of council housing POLICIES, or the effect of Bankruptcy 'LAW' on such 'POLICIES', I re-iterate my advice for the OP to take advice from the CAB, who deal with councils on a daily basis.

fermi

Agreed on the BR issue rog2.

With regards to a future contract with HA/council I agree bankruptcy (at least morally and I should really hope legally) should have no bearing on future provision of social housing, and neither should any previous debt comprised of rent arrears that is included in said BR.

And yes contacting CAB would seem to be a good idea, since knowing your rights in these sorts of circumstances and when you can push for them is vital if some official should prove to be awkward over this.

Has anyone got a link to an example HA contract, since I am now curious to have a look at the standard terms and conditions of these with respect to BR and how/if these differ to the ones commonly found in private LAT agreements. People ask quite often what happens with BR and it would be interesting to see what is in an example contract for myself.

wherediditallgo

The way my council explained it to me, no-one can be told they can't go on the housing list. However, whether you get somewhere to live depends on priority need. If someone has become BR & has lost their previous home, it could be argued by the council that they were deliberately homeless (who would turn around & deliberately give up their home, though? ) & therefore not a priority case & maybe not eligible for housing at all. If there are children or a vulnerable dependant, then there would be an obligation to provide housing for them, in which case the adult vulnerable person would have to submit an application in their own right & name the BR as someone living with them. A vulnerable child has a right to housing, but not necessarily in a council house or flat, & may be considered for a children's home or fostering placement until they were eligible to be housed in their own right.

I don't want to worry the OP, especially as they've already been accepted on the housing list, but my council took the view that if you've lost previous private accommodation through BR you could be a rent risk & could be considered deliberately homeless, & if you'd gone BR owing rent to the council (not council tax) you could go BR again after building up arrears again. So while they might not be able to legally get the rent arrears back from you, they were entitled to mitigate their losses by not taking the risk of re-housing you if they chose not to. They were therefore well within their right to not treat you (as opposed to your family unit) as a priority, but would have an obligation to provide you with housing advice & direct you to other agencies that might be able to help.

As I said, I think local advice is the most relevant here & I think (like fermi) that the OP would be well advised to speak to the CAB & housing advice centres in their area to get the most appropriate information for them. My first council tenancy agreement was nearly 18 years ago, & my current one (goodness knows where it is) came into effect well before I went BR. I do remember someone on this board though who had rent arrears in a housing association property, set up a payment agreement, went BR & was told they still had to pay them in line with the payment agreement. When they fell behind in their payments, they were very quickly told that court action would be taken to seek possession of the flat. It would seem from that that it's not solely the tenancy agreement that defines what happens, but also the default on the payment agreement. Hopefully, they'll see this thread and be able to advise what the tenancy agreement says. I suspect though that the tenancy agreement won't mention bankruptcy, but will mention non-payment of rent. It's the breach of this clause (either breached via the tenancy agreement or a subsequent payment agreement) that allows the council or housing association to take the person to court to repossess the property (whether the court allows them to do so is another matter). It would be a breach of the same clause that could allow them to refuse to re-house someone who was a council tenant in the past, as not being required by law to pay off the debt doesn't meant the debt didn't occur. I think the amounts involved would have some bearing on whether re-housing was allowed, as well as family unit composition & local housing stock levels.