A Free Bankruptcy, IVA And Simple IVA, Insolvency Advice Forum

[tilly]

Hg now you know the case, no that was it nothing else taken to the courts.

I know what you are trying to say.....
If the case had been succesfull and if Trustee 3 was removed I would still have to setlle my bankrutcy with Trustee 4.
Trust me I have only worked that one out in the last week.
But when you are swept along through the legal system and are fighting for your life or thats how it seemed to me,you can but only go with the advice given,after all we are not the specialist in this field they are.

But Im sure you will know understand why it all got so messy and protracted and all I can say is IF ONLY Trustee 2 had not retired when he did this mess would have been over, we would have settled at some point probably by late 96.

Tilly

[Hg]

What they were trying wasn't as utterly futile as that; I can see that they were trying to be clever and use that as an excuse to delays things past the three years.

What I guess your solicitors were aiming at was not just getting him out the road as of the date they hoped a court would find in your favour, but getting an order saying that he never should have been Trustee in the first place, because although he thought he'd been appointed, he actually hadn't been validly appointed.

That way they would have hoped they could then have his application for a charge on your house overturned and his application for possession of your house dismissed. To try and obtain this, they would have said that these applications weren't valid because these applications could only be made by someone who was Trustee, but that they weren't made by someone who was Trustee because Trustee3 had effectively never been Trustee on account of his appointment not being valid.

They would have hoped that Trustee 4 then would have had to start from the beginning, but would have been out of time to make an application from fresh because of the new 3 year rule.

The law on appointments is clear. Liquidators of insolvent companies and Trustees in bankruptcy really are quite different things. As well as the fact that their roles don't cross, there are lots of differences in the ways they are appointed and removed. Just in case you can't tell the difference, they are in completely separate parts of the legislation that are helpfully headed up "Winding up of Companies Registered Under the Companies Act" and "Bankruptcy".

Trying to use the law for liquidations in bankrutpcies or the law for bankruptcies in liquidations where the wrong rules are more convenient is a common trick, but it always fails.

Courts will look from one side to the other is the right side is silent on a matter. A good example is Bankruptcy Restrictions Orders (which are new) and Company Director Disqualification Orders (which are not). The BRO rules don't specify how to decide on the period, so judges decided to borrow the process that they use to decide how long Company Director Disqualificaiton Orders should be. If there had already been one and it was different, they'd have used that.

However they will never use the rules from the wrong side if the rules on the right side specify a course of action. In your case the rules stated quite clearly what needed to be done in a bankrutpcy.

Trying to read an amendment to the law as to how trustees are replaced in the light of the existing law on how liquidators are replaced is to me an ambitious and inventive task; a bit like trying to apply the guidelines as to when you take a cake out the oven to guidelines as to when you want to take meat out the oven. The cake mix says 25 mins at 220. Why would you ignore that because the instructions on a joint of beef said 200 for 30mins + 40mins a kilo?

Even if they has succeeded, my argument (though I have no idea whether it would be valid; this is not regularly trodden ground!) would be that you are never without a Trustee, as if one leaves office without a replacement, the Official Receiver automatically becomes trustee in their place. So if you never had Trustee 3, then you would still have had a Trustee at the time a Trustee made a Trustee's application; in the form of the OR.

But of course, this is the problem you come across when you are trying to use the system to say the system is wrong and change the system. The outcome is judged on what the system says, and the system quite often tends to say that actually, you are wrong and it was right!

[tilly]

I guess I should have paid more attention to what we were being fed.
Anyway today has brought more problems,what we thought had been sorted out is now not the case, the clock has started to tick again and to make matters worse nice letter from the bailiff arrived this morning.

As we no longer seem in communication with our so called legal adviser's, I am seriously considering trying to sort this major hurdle myself,not sure how but will have a bloody good attempt,but not got much time.

I have started asking myself recently "what have I done or what did I do wrong lord, to continually be punished"

Now in my other life, the one that puts the bread on the table, I deal daily with people who are experiencing tremendouse stress, all due to business failure, in the main they have brought it upon them selves, then there are the others who through no fault of their own are in the same position.I help them all in some way or other.

Anyway enough of me getting in to the doldrums,I have work to done.
Hg. I need a bit of advice but only if you feel able, its a bit too personal again as it involves them £ signs and 3rd parties.

Tilly

[Hg]

I can only try!

The PM button is straight under erm... where it says I'm bad at checking them. And if you post to say you've PMd I'll notice I've actually got a new message!

[tilly]

Hi Hg,I haven't sent you a pm, I had a bit of a knee jerk reaction with regard to my Fridays news of the day!!!

Any way back to the thread, thank you for your interpretation I must say that for the first time I can now understand what had been happening with my defence,after all my counsels opinion came from a very well regarded barrister and if he had been successful I am sure you are well aware that the outcome would have had a significant impact on the system.

Whats your opinion on Trustee 2 and then 3 ?
Do you think we could have avoided all of the litigation and how?
(without stating the obvious that if we had settled trustee 2)

Tilly

[Hg]

Hi Hg,I haven't sent you a pm, I had a bit of a knee jerk reaction with regard to my Fridays news of the day!!!

Any way back to the thread, thank you for your interpretation I must say that for the first time I can now understand what had been happening with my defence,after all my counsels opinion came from a very well regarded barrister and if he had been successful I am sure you are well aware that the outcome would have had a significant impact on the system.

Counsel for the Trustee is well regarded too, and I suppose this is where the problems start to come in!

It could have worked, and if it had done it would have lead, via more arguments, to somewhere closer to the result you wanted.

I can see what they hoped the outcome would have been if you had won the stage one, but I'm not sure that it would have been; that would have been for a second battle to decide.

If you'd won stage one that would have caused a nuisance, but I'm not sure how severe the effects would have been. I don't think there are many bulk transfers really.

Whats your opinion on Trustee 2 and then 3 ?
Do you think we could have avoided all of the litigation and how?
(without stating the obvious that if we had settled trustee 2)

Tilly

I think both were entitled to do what they did if they thought it was best.

You don't want me to state the first obvious, I daresay all I can add is the second obvious; settle with Trustee 3

[tilly]

Thanks again Hg
Raising money in this current economic climate is not easy and especially more so when you have to tell them what its for,suddenly you become high risk and lenders are very cautious these days,and so taking risks comes at a cost.
Coupled with the fact that there is only one income supporting the borrowing and you can only borrow between 65-70%LTV.

Realistically there are no other options, its very easy for a judge to hand down a possession notice.
So what then happens.....
You are forced out of your home,sorry local authority cant help you because you are not on benefits
You are still obligated to pay the mortgage until the property is sold
Oh dear housing market in area flat no ones buying because they cant get a mortgage....
The property sits empty until it can be sold could be 6mths or more...property reduces in value, result less equity to be split.
Meaning less for the Trustee also

In the meantime you are paying the mortgage, the rent on a property etc and before you know it the bills start piling up and guess what you are now in debt, ironic really when you think about it.Oh I nearly forgot when you do find a house to buy you now have to have a much bigger mortgage to fund...putting you into owing more debt.

What would have been a better solution taking into consideration the current climate,would have been for the judge to order a possession suspended for 12mths as in that time one would have been able to source the right re finance deal without being forced into the almost sub prime markets, the Trustee could have had his protection with a charging order and if the mortgage were to take several months to complete during that time the Trustee could have agreed monthly installments offsetting some of the costs.

But of course I would say that wouldn't I, however in these troubled and turbulent financial times negotiation and compromise are the key drivers to reaching a win win situation.

The sun shone this weekend and I tried very hard for the sake of my family and own sanity to try and forget for maybe just an hour, failed I'm afraid....every waking moment its all I think about, my job is very demanding and that gives me some release funnily enough as I have to make sure I am the best at what I do to keep in work as I need to be able to re pay the borrowings.....its a vicious circle and one I cant get out of unless I won the lottery....oh no the Trustee would take half of my winnings drat,but at least I keep my home.
Tilly

[Hg]

It's worse than unfortunate as this really isn't the climate to be trying to get a re-mortgage for that kind of purpose. I haven't seen it done recently, but I know that bankruptcy related secured lending was already very difficult and expensive about 18 months ago when things were only just starting to go wrong.

[tilly]

Tell me about it Hg...the clock is ticking and Im waiting to find out on yet another lender,things happen but you have to deal with them and I but can take on the finacial burden no choice..

Anyway I have been thinking some more about the chain of events or as I will now refer to as chapter 1, of my little story

I will post something tomorrow
Tilly

[tilly]

Hi Hg
Not sure if you know anything about costs, but were there any guidelines from the PRU to the IP who picked up these old files, as to how long and what costs/fees these old cases should have taken., especially if there were no creditors making claims.

for example a solicitor may charge approx £190 per hr and &
£70 per letter etc,he tells you about the costs and roughly how long the matter should take before you decide to instruct
he picks up a case,he then writes
10 letters £700
spends 10hrs on the matter £1900
there are a few additional costs say £200
Matter settled total cost £2800

In my case there was 1 unproven creditor for the IP/Trustee to deal with, so how long should the process have taken and what would have been the fees?
Tilly

[Hg]

There would be no guidelines from PRU. Insolvency practitioners would be working to their industry standards, which make then more expensive than lawyers on account of it being very hard to become one; probably at least one and a half times the fees charged by a lawyer in the same area.

The IPs costs in your case are likely to include a lot of time spent on asset realisation and legal fees; ie trying to get the house.

They could run up a bill of about £1k on day one of their appointment while working through the post appointment checks that IPs must do in new cases.

[tilly]

Hi Hg,
I was not really referring to the costs proportioned in my case, it was a question about generalisation of fee earners within the independent insolvency profession, I guess you more or less answered that...

However I was really referring to what the cost of Trustee 1 would have been? remember the house at that point had not come in to play and he had no legal costs to bare as there was no litigation, my solicitors at that time were in essence only advising me more or less acting as a mediator.

So he received his pack from the PRU late 03 or early 04 and there was my case...
there were 3 listed creditors
1.abc ltd £2500 unproven creditor
2.gas co £400 proven creditor
3.xy finance £700 proven creditor

He then sent out his first letter informing me of his appointment.
His second set out the creditors, original costs of bankruptcy, plus some interest and his anticipated fee's I guess, I some how remember the figure £9000


Now during this time through another debt forum I was informed that the trustee could only claim if the creditors agreed and if I were to settle independently with those creditors then Trustee 1 would only be able to claim the bankruptcy costs and his fee's.

So I attempted to make contact with all 3 creditors, this took a few months, the accounts were so old 2 of the creditors had to go back to archived files.

Gas co wrote confirming that they no longer wished to claim
Xy Finance wrote confirming that they no longer wished to claim

Please note that Trustee 1 had made no attempt to contact either of the above as was confirmed to me by both companies.

Trustee 1 then removed them from the claim

So he and I were left with abc ltd unproven creditor £2500

I made various attempts to find them but no luck... now if I had known then what I know now and with the use of the world wide web I could have tracked them down

Trustee 1 also made his attempts through his searches and newspaper notices, he also did not find them.

So to go back to my original question what would have been as a best guestimate his costs and fees and how would they have been calculated and proportioned?
Tilly

[Hg]

I'm surprised that it could be difficult to find a limited company? In theory a limited company can't go address not known, as it must have a registered office and anything sent there is deemed served.

I honestly couldn't give a helpful guess at what Trustee 1's expenses might have been, it would be just too much that; a guess. Major accountancy firms charge £600 an hour for their top insolvency people, smaller outfits might "only" charge around £300!

[tilly]

Hi Hg I made a mistake I am talking about Trustee 2 the one appointed in 2004,you said
"I'm surprised that it could be difficult to find a limited company? In theory a limited company can't go address not known, as it must have a registered office and anything sent there is deemed served."

Now that's very interesting because that's exactly what Trustee 2 did, he sent the notices or what ever he need to send to abc ltd at their last know registered address which would have been the address given on the date they petitioned for my bankruptcy.
I even went there and the building was empty and had been for some years, now I knew that one of the directors in fact he was the one who petitioned for my bankruptcy had died back in the early to mid 90's so I guess we assumed that the company had ceased trading

So are you saying that as far as Trustee 2 was concerned he was happy that his notices had been deemed served? and that after the notice periods had elapsed was then satisfied to finalise
my bankruptcy?

Well we thought the same as did our solicitor and thats how we came to the then settlement figure of approx £6000 in nov 05.

Now remember Trustee 2 then went and retired and Trustee 3 picked up from where he left off.

6MTHS after Trustee 3 appointment they located abc ltd.
Now abc ltd was no longer called that, it had changed name to xyz ltd, apparently back in 1995, probably when one of the directors died and had also changed their registered office which was now at a firm of accountants.

So it was xyz ltd who completed the claim form for proof of debt in nov 06 and it is xyz ltd who have a claim of approx £9000 inc interest.

Now both these companies were and are in essence sole traders but for obvious reasons run their business activities through a ltd

So Hg does that give you yet another bit of insight as to why this matter has been such a mess and why I keep asking questions.
Tilly

[Hg]

I knew which trustee you meant.

Are these companies separate, or just a change of name?

If it's not just a change of name then the second company would need to offer some kind of proof as to why they are entitled to collect the debts of the first company. Of course in reality, you'd have no way of telling whether or not the ink was wet...

And of course, all this is exactly the sort of hassle that will add to the Trustee's fees

[tilly]

Hi Hg
If it's not just a change of name then the second company would need to offer some kind of proof as to why they are entitled to collect the debts of the first company. Of course in reality, you'd have no way of telling whether or not the ink was wet...

I don't know I suspect it must be a change of name, when I did a search on companies house XYZ Ltd is listed previously known as ABC Ltd, but there are different directors only one is from ABC ltd,I asked for proof but all I got back was the official proof of debt court form dated Nov 06 with the creditor listed as XYZ ltd and that they stated all proof of debt documents had been submitted to the court back in 1990, which I found odd as if that had been the case why had the court listed them as an unproven creditor.

Of course it will have added to the fees when Trustee 3 started looking for them, but my asking for proof did not as I didn't get any.

Interestingly enough the director of XYZ ltd has had or has a variety of companies to which he has an association with as director, yes I know all about him now its amazing how easy it has become to find this information on the net when you know where to search and pay the fees for that information.
Its just a pity I didn't know back in 05,I could have approached him and made an offer to settle my debt, ah hindsight is a wonderful thing
Tilly

[Hg]

Yup. Always

If they filed the proof of debt at court that might explain why it went walkabout. You send proofs to the OR or Trustee, not the Court!

[tilly]

Hi Hg

"If they filed the proof of debt at court that might explain why it went walkabout. You send proofs to the OR or Trustee, not the Court!"

So they have made a false declaration then!?

Is that why they were listed as un proven creditor because the OR was aware of their claim but had not seen proof back in 1990
Tilly

[Hg]

You can't call it a false declaration... more of an innocent mistake!

It probably is.

[tilly]

Ah well I have just had confirmation that the insolvency service are at least going to look in to my query/complaint but have had difficulties trying to locate any files as the matter as they say is almost 20yr old and in all probability the files have been destroyed, funny that as someone must have some of that information I would expect my current Trustee 3 has some old papers.
Whilst I probably know what their response will be after being on this forum and having Hg as an excellent sounding board it still gives me a little bit of comfort that they will look into it.

For those of you that have been following this thread or story I have come to the final chapter well at least the start of it.

This week did not start well on the personal front with my other half finally having a mental breakdown, the stress of it all finally took its hold.
I guess the good news is that we are now in funds and are able to settle.
However for some strange reason Trustee 3's solicitor is ignoring all forms of communication, several phone call, e-mails Fax's and letters have all been sent on almost a daily basis from my solicitor but no response, I'm almost starting to believe that they must be enjoying putting us through more and more hardship and all they want is to make us homeless, I have visions of the bailiff turning up and then the police as we refuse to leave and then suddenly the phone call from the other side calling off the dogs just because they can, I almost want that to happen as then I will be able to clearly demonstrate how we have been treated and almost hounded by this solicitor.

I also hope they don't start playing dirty tactics as all we are waiting for is the re-confirmation of the amount that was agreed for my interest in the family home to be purchased, its a cpl of £1000 less than what my total equity would be but that's all we can finance on a 75% LTV re mortgage once admin charges and fees have been taken in to account

So we can but now wait and that's the difficult bit, for me personally its been a real tough few weeks balancing all those plates, work,my partner,my family, my home, finding finance and I hope to come out the other end with a few wounds that will heal but the scar will always be there.

Tilly

[Hg]

All the best - keep hassling the solicitors along!

[tilly]

Hi Hg, still hassling the solicitor but he just ignores all calls and fax's, the funds are there!! bizarre situation!!

Anyway I have been told this week that I should be applying to have my bankruptcy annuled as all costs and creditors will now be paid is this right?

Also something about ad velorum should not be charged as a third party is paying my debt, and something about if I am settling all costs etc then we do not need to buy out the Trustee interest in the property.

Whats your thoughts on the above and should I be doing something about it?
Thanks
Tilly

[Hg]

This is strange. Why wouldn't they want money?

You want to pay the creditor direct so you don't get charged for the IP paying them. You'll need to pay the IP's fees direct to them, obviously.

I would suggest speaking to your solicitor about the road ahead now, it's possibly worth making the annulment application and, if you are dubious about the other side's intentions and if they have a warrant, applying for a stay of the Trustee's possession order.

A lot might depend on how fast your local court is, as you don't want the annulment application to be heard before people have actually been paid.

[tilly]

Thanks Hg
At last they acknowledged late yesterday, as the money is with another firm of solicitors I don't think I am able to pay the creditor direct as I think they are going to settle sometime today, the advisor who had been dealing with the litigation case is on holiday until Monday so I will need to speak to her to get her to make the application for annulment.
They have informed the other solicitor that they will suspend the possession warrant, but I will need to make sure it is withdrawn.

Is there anything else I should be mindfull of as this has been a dirty game all along
Tilly

[Hg]

Not really; just make sure your solicitor pays the creditor not the Trustee, but they should know to do that anyway.

All the best!