Shared account overdrawn after divorce

[Deleted User]

Hello,

Could anyone offer advice with this predicament?

Following separation from my now ex-wife, she took the liberty of using the debit card for our joint Nationwide account to make as many online purchases as she could in a day before it was presumably stopped by the bank.

Despite no overdraft, the purchases were allowed even after the account was emptied. Nationwide told me to blame Visa because their system doesn’t take funds until sometimes days later. My point was that each payment is known about instantly as reflected in the online banking which will show account balance and money available as two separate amounts with the available balance instantly showing deductions following card use, but my protests got me nowhere.

I was told that we were both responsible for the full amount and they wouldn’t let me close the account without the sociopath’s written agreement which she refused to give (still have a joint Halifax account with 0 balance because she wouldn’t sign the consent form even after remarrying).

So, I’m now named on an account over £600 in debt. I can’t afford to repay it and don’t want to since I didn’t spend one penny of it. I know legally it’s my debt as well even if I don’t like that.

My credit rating is harmed by it though, which is causing problems, especially as there’s also a mortgage default and repossession on there as she changed the locks, left me homeless and my solicitor told me not to force my way back in due to family court proceedings in progress, then she didn’t pay the mortgage and I couldn’t afford to as I was then paying 60% of my wage on a council emergency accommodation house.

So, a mess. Anything I can do to improve things?

eskbanker

There's no point in directing your anger at Nationwide, in your shoes I think I'd be pursuing the solicitor and/or getting a better one.

It's obviously impractical for those of us reading this to understand the timescales but separation, divorce and remarriage would typically be over a reasonably lengthy period of time, and the divorce step in particular should entail a complete resolution and settlement of all financial matters to avoid the situation you describe, i.e. closing all joint accounts, agreeing ownership of debts and assets, etc, while there's still motivation on both sides to sort everything out. Why hasn't your solicitor insisted on this happening?

[Deleted User]

I’m not directing anger and have had no communication with Nationwide in years, I’m simply looking to see if there’s anything I can now do as my credit rating has become an issue due to my current circumstances.

The divorce was 4 years ago.

I agree that the solicitor was sub-par. Unfortunately back then I was in terrible turmoil and not in the best of states. As there were no assets (no savings, negative equity) the solicitor said there was nothing to resolve financially.

I do recall the solicitor sending one of their expensive pointless letters to my ex-wife’s solicitor requesting she sign the forms to dissolve the joint accounts but it was ignored as were all the letters, and I was led to believe nothing more could be done.

Being in a state, having no legal knowledge and worrying to death about the £160 an hour charge rapidly creating a debt (that took years to pay), I stopped asking questions and did as I was told.

I imagine the situation is as I feared, either I pay Nationwide or I suffer the consequences (which don’t bother my ex-wife at all). As for the repossession, it happened and it’s recorded and that’s that.

IanManc

eskbanker wrote: »

There's no point in directing your anger at Nationwide, in your shoes I think I'd be pursuing the solicitor and/or getting a better one.

It's obviously impractical for those of us reading this to understand the timescales but separation, divorce and remarriage would typically be over a reasonably lengthy period of time, and the divorce step in particular should entail a complete resolution and settlement of all financial matters to avoid the situation you describe, i.e. closing all joint accounts, agreeing ownership of debts and assets, etc, while there's still motivation on both sides to sort everything out. Why hasn't your solicitor insisted on this happening?

I don't often disagree with Eskbanker, but I do in regard to the two bits hightlighted above.

As far as the first is concerned, you're not in a position to advise that the OP "pursue" his solicitor because you don't know anything like the whole story. You have no evidence that indicates that the solicitor has been negligent or any other basis on which to advise that he or she has fallen down in their duty to their client. The OP has described the other party in disobliging terms - a "sociopath" - and we are told that there were also family court proceedings taking place at the time, the OP had been excluded from the marital home, and that it was subsequently repossessed. There is clearly a lot more to this story, and a glib piece of advice to pursue the solicitor is based on wholly insufficient information.

Secondly, a solicitor can "insist" on something till he or she is blue in the face, but cannot make the other party in a divorce do something that she refuses to do. The OP's solicitor did in fact request that the other party sign the forms to dissolve the joint accounts - by writing what the OP calls "one of their expensive pointless letters" - but the other party wouldn't do it.

So the OP's solicitor did the right thing, and the other party's solicitor will almost certainly have advised her to sign, because the purpose that both solicitors will be pursuing, and the point of the proceedings in the first place, is to sort everything out. But if a client will not take advice and will not do as suggested then there is nothing that their own solicitor can do as clients instruct solicitors, not the other way round; and the OP's solicitor has done what he or she should have done to try to finalise the matter.

As far as the Halifax account is concerned, the Halifax T&Cs say that if an account was opened after 13th June 2010 then any one joint account holder can close it. If it was opened before then it can only be closed by both holders if Halifax agreed at the outset only to accept the instructions of both - otherwise any one should be able to close it.

As far as the Nationwide account is concerned, they're not going to close an account which is in debit, and the OP is right that both he and his ex are both liable for it. Eventually pursuit of it will become statute barred, but the consequences as far as the credit record is concerned will remain.

The obvious way to get rid of it is to pay it off - which is offensive to the party who didn't run up the debt in the first place. Where someone is responsible for the whole debt, they can be made to pay by the creditor taking proceedings against them. They can choose who they go for, and it needn't be the party who ran up the debt.

While the OP might try to get back the money from the other party, for example, by suing her, that is a separate matter and does not stop the creditor from requiring The OP to pay. And in this case suing the ex would cost money and there's no guarantee that the debt would ever be paid by her even if judgement was obtained.

eskbanker

Fair enough, I was trying to convey that from my reading of the situation I couldn't see that Nationwide were at fault but that the loose ends didn't seem to have been tidied up from a legal perspective and that is the reason why expensive solicitors are retained. Perhaps 'pursue' was too strong a term and I wasn't seeking to imply that OP's solicitor was actually negligent as such, just that it should have been made clear to OP that failure to sort out joint accounts would have consequences.

It's still not clear exactly when the unauthorised overdraft was run up - the thread title suggests after divorce but the OP implies after separation so perhaps before divorce. If pre-divorce then I'd have expected OP's solicitor to have sought to include the £600 in a financial settlement or if the debt was incurred after divorce then the solicitor should have advised OP to put the account into disputed status to prevent that from happening.

Obviously OP has clarified some points since my post so more is known now than when I posted, but clearly it'll be a complicated story to summarise so I wouldn't dispute the point that nobody on here (other than OP) knows the full story.

Anyway, OP, have you reviewed your credit files in detail so as to see exactly what the impact is, such as the default date of the mortgage? Have Nationwide defaulted the overdrawn account?

EachPenny

IanManc wrote: »

Secondly, a solicitor can "insist" on something till he or she is blue in the face, but cannot make the other party in a divorce do something that she refuses to do. The OP's solicitor did in fact request that the other party sign the forms to dissolve the joint accounts - by writing what the OP calls "one of their expensive pointless letters" - but the other party wouldn't do it.

So the OP's solicitor did the right thing, and the other party's solicitor will almost certainly have advised her to sign, because the purpose that both solicitors will be pursuing, and the point of the proceedings in the first place, is to sort everything out. But if a client will not take advice and will not do as suggested then there is nothing that their own solicitor can do as clients instruct solicitors, not the other way round; and the OP's solicitor has done what he or she should have done to try to finalise the matter.

It is difficult to comment without knowing the full story, but there are some issues with this bit.

If the OP's ex refused to sign the papers to close (or at least separate) the joint account(s) then the solicitor should have advised the OP to consider seeking a financial remedy order. The first step would be mediation which would have given the opportunity for the ex to see sense, although agreement to accept or apportion the debts in the account would have been necessary.

The difficulty with a financial remedy in this situation is the apportionment of debt and the costs of obtaining an order. However, the solicitor might have advised the OP to act as a litigant in person since the issue could be restricted to the relatively simple matter of closing the accounts. At this stage the ex's solicitor is likely to have advised very strongly to agree to the closure since the costs of defending the application could be significant and a judge would look unfavourably on someone who was just being difficult. Although costs are not normally awarded as part of family proceedings, it can happen if someone is being particularly difficult.

If the advice the OP got from their solicitor was that there was nothing that could be done, then I tend to agree with eskbanker that the advice was not as good as it should have been.

IanManc

EachPenny wrote: »

It is difficult to comment without knowing the full story, but there are some issues with this bit.

If the OP's ex refused to sign the papers to close (or at least separate) the joint account(s) then the solicitor should have advised the OP to consider seeking a financial remedy order. The first step would be mediation which would have given the opportunity for the ex to see sense, although agreement to accept or apportion the debts in the account would have been necessary.

The difficulty with a financial remedy in this situation is the apportionment of debt and the costs of obtaining an order. However, the solicitor might have advised the OP to act as a litigant in person since the issue could be restricted to the relatively simple matter of closing the accounts. At this stage the ex's solicitor is likely to have advised very strongly to agree to the closure since the costs of defending the application could be significant and a judge would look unfavourably on someone who was just being difficult. Although costs are not normally awarded as part of family proceedings, it can happen if someone is being particularly difficult.

If the advice the OP got from their solicitor was that there was nothing that could be done, then I tend to agree with eskbanker that the advice was not as good as it should have been.

I wouldn't like to have been the unlucky mediator who got this one.

I think that the bottom line here is that the parties were at war and there was no money to pay any additional costs.

EachPenny

IanManc wrote: »

I wouldn't like to have been the unlucky mediator who got this one.

I think that the bottom line here is that the parties were at war and there was no money to pay any additional costs.

Yes, which is why a 'call her bluff' approach might have been the best way to go.

If there was a mortgage (presumably joint), plus joint finances, then I don't understand how the OP was advised:-

Chapster wrote: »

...the solicitor said there was nothing to resolve financially...

Also, if it was clear that the ex was unable to pay the mortgage then I would have wanted to explore options to have the property sold cleanly, rather than allowing it to go to repossession. Or perhaps for the OP to take full ownership and move back in rather than living in council accommodation (subject obviously to affordability).

Lots of questions, not much info to go on.

benjus

I'm no expert here but I'll share some personal experience. About 5 years ago I still had a Nationwide joint current account with my ex-wife (zero balance, and I'd had all the cards cancelled). I called Customer Services to ask if I could unilaterally close the account and was told no, I needed her permission. I went to a local branch and was told the same thing. I went to a different branch and managed to find someone more senior (the assistant branch manager, I think) who was sympathetic and had the power to close the account, and he did it there and then in the branch. If you take a similar approach and make it clear that you're prepared to clear the overdraft (maybe bring it with you in cash) if they will close the account immediately you might get lucky... I think the key is to find someone with the authority to do it. But you won't get anywhere trying to close the account while it's overdrawn, so you'll have to find the money from somewhere.

If that doesn't work, you could consider paying off the overdraft and having the account(s) frozen with zero balance(s). At least that will stop interest accrual and impact on your credit history.

Then you can look into ways to claim the £600 back from her.

If you do nothing, you'll be stuck with an overdrawn account with her which will be attracting interest and could damage your credit history. You'll also be financially associated with her indefinitely.

Trying to force her to pay off the overdraft and agree to close the account is likely to take a long time and could end up costing more than paying off the overdraft.

So personally I think I'd take the £600 hit in exchange for getting this mess contained, then have more time to try to recover the money at your leisure.