Parents debt

[Demonz]

Hi

I'm wondering if anyone can possibly help me please?

In 2007 my mother applied to made bankrupt. She did so with the help of the CAB. In Oct 2007 it was granted. We thought it would be all behind her from then on but for some reason part of the debt has now come to my sibblings and myself.

In 2002 my mother (who was divorced and bought out my dads half of the house) sold her house and moved in with her new husband. She told us instead of giving us something from the sale, she would give us something from the endowment policy which she intended to carry on paying. In 2006 this matured and as promised she gave my brother £2000, my sister £5000 (which went towards her wedding) and myself £2000.

In 2007 her new marriage broke down and she moved into rented accommodation. Being on her own meant she could not repay her debts as they were more than her income. Hence the bankruptcy.

Now my sibblings and I are receiving threatening letters from a solicitor demanding the money she gave us and if we don't pay the baliffs will come and take goods to the value.

I'm really scared. My husband is on low wages and I have 2 small children. I really don't have that kind of money.

Can anyone help me please?

[cerberusalert]

Now my sibblings and I are receiving threatening letters from a solicitor demanding the money she gave us and if we don't pay the baliffs will come and take goods to the value.

For a start they cannot send bailiffs without a court order, secondly you are not responsible for your mothers debts and as she made a gift to you and your siblings prior to her bankruptcy that money doesn't come into the equation unless the solicitors can prove to a court that your mother was trying to dispose of assets prior to her bankruptcy.

 

Make a complaint to your local Trading Standards and the OFT enclosing a copy of the threatening letter.

[Ell-enn]

Is this a real firm of solicitors or in actual fact debt collectors? How did they know your mother gifted the money to her children?

[PGH7447]

yep who is it - name and shame, gifts given before a bankruptcy have nothing to do with these xxxxxxxxx

Edited February 18, 2010 by PGH7447

[palomino]

What reason is the solicitor giving for demanding the money? He can't just front up and say 'give me some money'.

 

The distribution of the proceeds of the endowment insurance should have been declared to the Official Receiver. Was it? The OR will always ask about disposals of large sums of money in the years preceeding the bankruptcy.

The reason is that such disposals can be interpreted as preferring one or more creditors over others - which is not permissible and can lead to some difficulties. In bankruptcy all creditors should receive a pro rata share of any monies paid out.

In the circumstances you have described I would expect the OR would not be bothered by the disposal your mother has made. The best course of action is to contact the OR who dealt with your mother's case and ask.

 

Returning to the solicitor, the reason you are being asked to pay money to him is that your mother may not have told the OR about the disposal and he may therefore believe the money was unlawfully distributed. Hence the first question above.

 

Firstly I would try to ascertain why the solicitor is asking for this money.

 

Secondly I would contact the Official Receiver and ask them to deal with this. Even if your mother didn't tell the OR at the time then she should do so now. You might get into a bit of bother but you will get into much more bother by continuing to withhold the information. The OR has a good reputation for fairness and, because of the powers an OR has, can easily deal with the solicitor. But he doesn't like being mislead.

On the other hand if your mother has told the OR at the time of the bankruptcy then this will have been taken into account. You're in the clear and can simply refer the solicitor to the OR.

[PGH7447]

I see where you are coming from palomino, but according to the OP's post, she gifted the money in 2006 and then the marriage broke up in 2007 whihch led to the bankruptcy, so unless the OP's mother was a clairvoyant then there is no comeback about the gift, and the solictor should take a running jump

[Demonz]

Hi all and thank you for your replies.

 

When my mother applied for the bankruptcy they asked her about any large amounts of money she had had in previous years. She told them about the endowment. The letters are coming from a firm called Farleys. They have a website so i'm assuming they are a legit company

[Demonz]

She also told them how much was given to each of us*

[cerberusalert]

The legal term I believe is " She covered her ass".

 

Refer it to the Official Receiver.

[palomino]

From what you describe you are well in the clear. If there had been a problem then the OR would have dealt with this at the time.

 

You can safely refer the solicitor to the OR and wash your hands of the matter (although the solicitor may be persistent).

 

You haven't said on what basis the solicitor is asking for money. Are you able to do so?

[Demonz]

Sorry for the delay in getting back but I wanted to get the letters my mum had received as well as the one my sibblings and I received.

 

Dear Madam

IN THE ******* COUNTY COURT ***OF 2007

 

As a result of the bankruptcy order made against you on 14th September 2007 you now have certain legal obligations to me, as the Official Receiver appointed to deal with your bankruptcy. This letter sets out what you must do now, and it is important that you take time to read and understand it. If you have any queries concerning its contents, you should contact my office without delay as staff here will be able to assist.

 

My mum had given all the information that they required including the gifts made to her children.

Then my mum got this:

 

Dear Mrs *****

Our Client: White & Co

We act on behalf of your Trustee in Bankruptcy and have been instructed to write to you specifically in relation to gifts made to your children.

We are instructed that in May 2006 you made 3 seperate gifts amounting to £9000.

We believe these gifts were made despite the fact that you were insolvent. Under Section 341 of The Insolvency Act 1986 the Trustee has the right of repayment of monies where a transaction was at an undervalue.

We would invite, by return, confirmation that these monies will be reimbursed together with the addresses of each of your children who received funds.

We would remind you of your statuary dutry to co-operate with the Trustee in providing this information.

We await hearing from you.

Yours faithfully

 

Jonathan Bridge

PARTNER

 

So my mum complied and gave our addresses and asked them what would happen to her children if they no longer had that monies.

She never got a reply but they obviously recieved her lettter as they started making demands on the children.

She tried multiple times to get in such with Mr Bridge but he is NEVER there. It's always "He's just left for the day" or "He's working in another office today" even though she called the other office and he wasn't there at all.

 

This is the one my sibblings and myself are receiving:

 

Dear Miss ******

Our Client: White & Co

Debtor: Mrs *****

We refer to the above matter and note that no repayment has been received of the monies advanced to you by the Bankrupt.

In the absence of any repayment proposals our only option is to issue proceedings, which will be done without further delay.

If you do wish to put forward proposal please advise by return.

 

Jonathan Bridge

PARTNER

 

I have tried to call and just like my mum said it is impossible to talk to this man.

As you can see by the dates, my mum gave us the money in early 2006 and was made bankrupt in late 2007.

[cerberusalert]

Have you been in touch with the Official Receiver yet? He should nip this in the bud.

[Demonz]

Have you been in touch with the Official Receiver yet? He should nip this in the bud.

 

Hi and thanks for replying,

 

My mum rang them today but only the secretary was there.

She said my mum needs to try and resolve the issuse with Mr Bridge and if that fails make a complaint to the OR.

[cerberusalert]

She should make a complaint to the OR anyway, 'Mr Bridge' has no claim on gifts which were made so long before bankruptcy.... it was done a year or more previously.

[harrassed senior]

Have you any idea who they are acting on behalf of , and what for?

 

I know little about bankruptcy, but am guessing that his 'client' was either not included in the br payout, or feels he has not received enough.

 

If this is the case, surely he cannot expect to get the gifted money back entirely, would this not be a case where IF this money were refundable, then surely ALL Creditor would get a further share, or is he trying to creep under the radar so to speak?

[Demonz]

Have you any idea who they are acting on behalf of , and what for?

 

I know little about bankruptcy, but am guessing that his 'client' was either not included in the br payout, or feels he has not received enough.

 

If this is the case, surely he cannot expect to get the gifted money back entirely, would this not be a case where IF this money were refundable, then surely ALL Creditor would get a further share, or is he trying to creep under the radar so to speak?

 

After my mum has made many calls it seems the Trustee is the one who has instructed Farleys to recover the money from my sibblings and myself.

The money was gifted in early 2006 and my mum applied for bankruptcy in Aug 2007. They state that they believe my mum was insolvent when she gave us the gifts but this simply isn't true. All her debts were being met until 3 month before she became bankrupt. My mum has called the OR and the Trustee but they have told her they cannot help her as her children are the ones who _owe_ the money.

Any ideas what I can do please?

[PGH7447]

Let them issue proceedings then, I cant for the life of me see why they are attempting this

[Demonz]

If they are saying my mum was insolvent when she wasnt, can she demand to know what proof they have? Is it classed as some kind of slander to make allegations without proof? (ok im maybe clutching at straws....)

[palomino]

Forget about the slander - it doesn't apply in this situation.

 

Has your mum's bankruptcy been discharged?

I don't think this has been asked before, however it does seem a long time for a bankruptcy to last without being discharged.

If not then the OR is still dealing with the matter and this might explain what is happening.

 

There is pongy whiff about all of this. Why hasn't your mum been kept informed of what is happening? Why did Farleys suddenly demand money with no explanation? Their highly arrogant attitude is unfortunately typical of many solicitors.

 

I would lodge a formal complaint about the actions of the Official Receiver in not explaining things.

I would lodge a formal complaint with Farleys about their high-handed and confrontational attitude which has exacerbated the matter, causing considerable distress to yourselves.

I would also ask Farleys on what basis they believe your mum to have been insolvent at the time she made the gifts.

 

If you need to prove your mum wasn't insolvent then I guess that she has to show that the debts included in her bankruptcy weren't delinquent 15 months earlier. You'll need all your bank statements, credit card statements etc. etc. to show that everything was up-to-date.

Unfortunately lawyers and judges expect everybody to be dishonest. It's horrible, nasty and unfair, but it's life unfortunately.

[Demonz]

Forget about the slander - it doesn't apply in this situation.

 

Has your mum's bankruptcy been discharged?

I don't think this has been asked before, however it does seem a long time for a bankruptcy to last without being discharged.

If not then the OR is still dealing with the matter and this might explain what is happening.

 

There is pongy whiff about all of this. Why hasn't your mum been kept informed of what is happening? Why did Farleys suddenly demand money with no explanation? Their highly arrogant attitude is unfortunately typical of many solicitors.

 

I would lodge a formal complaint about the actions of the Official Receiver in not explaining things.

I would lodge a formal complaint with Farleys about their high-handed and confrontational attitude which has exacerbated the matter, causing considerable distress to yourselves.

I would also ask Farleys on what basis they believe your mum to have been insolvent at the time she made the gifts.

 

If you need to prove your mum wasn't insolvent then I guess that she has to show that the debts included in her bankruptcy weren't delinquent 15 months earlier. You'll need all your bank statements, credit card statements etc. etc. to show that everything was up-to-date.

Unfortunately lawyers and judges expect everybody to be dishonest. It's horrible, nasty and unfair, but it's life unfortunately.

 

My mum was discharged in SEPT 2007.

My mum is writing letters at the moment to both the Trustee and Farleys who they have instructed to act asking for them asking them to provide proof that my mum was insolvent in 2006

[PGH7447]

your dates dont make sense, you said she applied in Oct 2007 and above you say she was discharged in sept 2007, is this a mistype or was she made bankrupt in sept 2006 in which case they may have a valid excuse to chase

[Demonz]

Forget about the slander - it doesn't apply in this situation.

 

Has your mum's bankruptcy been discharged?

I don't think this has been asked before, however it does seem a long time for a bankruptcy to last without being discharged.

If not then the OR is still dealing with the matter and this might explain what is happening.

 

There is pongy whiff about all of this. Why hasn't your mum been kept informed of what is happening? Why did Farleys suddenly demand money with no explanation? Their highly arrogant attitude is unfortunately typical of many solicitors.

 

I would lodge a formal complaint about the actions of the Official Receiver in not explaining things.

I would lodge a formal complaint with Farleys about their high-handed and confrontational attitude which has exacerbated the matter, causing considerable distress to yourselves.

I would also ask Farleys on what basis they believe your mum to have been insolvent at the time she made the gifts.

 

If you need to prove your mum wasn't insolvent then I guess that she has to show that the debts included in her bankruptcy weren't delinquent 15 months earlier. You'll need all your bank statements, credit card statements etc. etc. to show that everything was up-to-date.

Unfortunately lawyers and judges expect everybody to be dishonest. It's horrible, nasty and unfair, but it's life unfortunately.

 

My mum was discharged in SEPT 2007.

My mum is writing letters at the moment to both the Trustee and Farleys who they have instructed to act asking for them asking them to provide proof that my mum was insolvent in 2006

[palomino]

My mum was discharged in SEPT 2007.

Are you sure the year is right? You first post says she was declared bankrupt on Oct 2007.

 

 

Well done with the letters.

[Demonz]

Are you sure the year is right? You first post says she was declared bankrupt on Oct 2007.

 

 

Well done with the letters.

 

I'm sorry I changed the dates to try and mask who my mum is.

She was discharged on Oct 26th 2007.

[palomino]

I see. But we're still confused.

Do you mean that she was declared bankrupt in 2006 and discharged in 2007?

If this is the case then the bankruptcy occurred only 5 months after the money was paid out, and I'm not surprised the OR is on the case.

 

Unfortunately timing is important on this matter.