CCJ and Bankruptcy

[Mr House]

I have several questions relating to voluntary arrangements, bankruptcy, CCJs and how I feel the system has compounded my own personal situation and has prolonged my credit issues following discharge from Bankruptcy in 2008. My first is about getting a CCJ removed from my credit history, hopefully someone here will have some experience on this and be able to advise on my chances.

 

In Mid April 2007 we closed our business and filed for Bankruptcy after a protracted attempt to get a PVA (Partnership Voluntary Arrangement) in place and on the advice of our IP. We were given a court date of late July! During this time we were continually pursued by creditors including the Inland Revenue, who we informed of our circumstances. However on the 12th of July, 14 days before our bankruptcy court date, the inland revenue took out a CCJ against us.

It is my understanding that after applying for bankruptcy we should not make any payment to a creditor as this would be seen as preferential/unequal treatment (interestingly, our initial PVA was rejected by the Inland Revenue for the very same reason!).

The revenue were informed of our BR application and bankruptcy hearing date and would obviously know that we could not make a payment so I do not feel it was justified for them to take the action that they did.

Also, if our hearing date had not been delayed for so long due to court backlogs in our area then this CCJ would not have been taken out at all - i.e. if our court date had been immediate or set for a week or so after our application, as one might expect(?) then a lot of anguish, complications and this CCJ could have been avoided. Instead we had to wait 99 days to have our case heard!!

 

Would I be able to request that the CCJ be removed on these grounds? And, would anyone be able to advise on the likelyhood of the appeal succeeding?

[toddle2u]

Does the PVA not show up on your credit file? A VA on your credit file is as bad as having a CCJ so I cannot see why you would want to appeal. The fact that you had to do a VA in case means that the CCJ was valid so any appeal would be bound to fail

[debtinfo]

Did you go bankrupt, if so what do you care about the CCY for, it willdrop off at the same time as your bankruptcy, i cant see how your situation is any worse with the CCJ

[Mr House]

We did not manage to get the PVA in place (long story, for another time), in the end we declared bankrupt.

The reason for trying to get the CCJ removed is that we have been informed by our bank that they would be able to give us a current account if the CCJ was not on our credit history (or listed as satisfied) - this would give us a head start in rebuilding our credit rating, to perhaps get a better savings rate and would be a step closer to being able to buy our own home (we are currently 'stuck' in an expensive rental property).

We have a basic personal account with Co Op and a business account with Barclays. The latter have offered a 'normal' personal account if we can sort the CCJ.

 

I have written to the court and sent them our discharge notice but the CCJ is still showing an amount on my credit history (not sure if this can be satisfied by being included in the bankruptcy in the same way as our credit card debts were??).

Which is why I am now looking at whether the CCJ should be there in the first place - we filed for bankruptcy but did not get our hearing promptly due to court back logs (99 days, in our case) so more payments were missed and during the period HMRC put the CCJ in place (they knew our circumstances and had been informed that we had filed).

This delay was beyond our control. Yes, we were reponsible for the debts but it seems unfair when you are instructed to cease making any payments to creditors as you are declaring bankrupt and handing over your affairs to the official receiver and then to have one government department take action to recover their money whilst waiting for another governement department to process our bankruptcy. If we had made a token payment to HMRC then the CCJ may have been avoided but that would have been preferential treatment of a creditor - damned if you do, damned if you don't.

The way I see it BR process should have been quicker (say, 14 days - not 99) or maybe the BR period backdated to nulify recovery action taken against us in the interim. I'm sure if we had paid amounts to any creditors during the delay period that the OR would have taken steps to reverse them, recover the money and penalise us; why not take action to reverse any additional court actions taken by creditors because we weren't paying them in the meantime (as we were instructed!)

Edited June 2, 2011 by Mr House
clarification

[debtinfo]

You have no right to have the CCJ marked satisfied but the creditor can do it if they wish to.

 

You could have applied for an interim order at the time (whether a judge would have though that protecting your credit score was a good enough reason would have been down to them)

 

Technically you did not file (petition) for bankruptcy 99 days in advance, you petitioned on the day in court.

 

The only thing i can add is that the effects of bankruptcy are meant to be long lasting and substantial and is each creditors own choice what products they give you,

 

If you appy to The court now for some sort of rectification they will probably tell you that the the orders were correct at the time they were given and to naff off and stop wasting the courts time that could be used in processing other peoples bankruptcy claims quicker

[Mr House]

Thanks. That's why I'm asking the question here...... mainly because I do not want to pay for an appeal that is likely to be rejected but also because I do not want to waste my time or the court's unnecessarily.

 

I guess technically we did not petition until 26th July even though the date we attended court to put in our application was 18th April. We did not have the luxury of taking our case to a court in another area that was less busy (delays were far less or non existant in some nearby areas) - I would happily have done this to speed up our case and ease the burden on our court's obviously stretched resources. But we had to petiition locally. HMRC used a court in another part of the country which I guess did not have such a backlog.

 

Incidentally, I started looking at this topic following something i read on trustonline.org.

They suggest that CCJs can be set aside if there's been a mistake - (quotes) 'a default judgment when you had sent back the form asking for more time'. Or, 'If you didn’t get the papers' - What form? What papers?

My only recollection of any information regarding the CCJ prior to it being put in place was a phone conversation with HMRC where I informed them that we had applied for bankruptcy and were awaiting our court appearance.

We did not receive any forms or papers to appeal their action.

Edited June 2, 2011 by Mr House

[toddle2u]

You would not have got any papers to appeal their action but you would have receeived papers to defend the action. The 'form' they refer to is to gain more time to submit your defence (extra 14 days) and the 'papers' they refer to would have been the court action papers for the CCJ which would have been served with the 'form'. I think you would be onto a loser going for a setaside on these grounds because the deb was admitted and included in the bankruptcy. Just because you didn't receive the papers it doesn't automatically mean that the CCJ would be set aside. You have to have a triable issue with a chance of success. In this case you wouldn't.

 

I would write to HMRC with a copy of your Dicharge notice and ask them to update the CRA's that the file should be marked as satisfied or alternatively you could ask the CRA's directly by sending them a copy of your credit file. I think this could be your only hope.

[mcuth]

I had a CCJ registered without receiving the claim form just as I went BR.

I asked the OR about challenging it (as the OR administers your affairs) and got the following reply: "The Official Receiver would not look to overturn the CCJ on the grounds the paperwork was not received, and you cannot commence any legal actions other than for personal injury. I appreciate that it is annoying that the paperwork was not served correctly but the creditor will not get any preferential treatment in the bankruptcy by registering the CCJ."

 

I would write to HMRC with a copy of your Dicharge notice and ask them to update the CRA's that the file should be marked as satisfied or alternatively you could ask the CRA's directly by sending them a copy of your credit file. I think this could be your only hope.

 

In my case (above), after discharge I wrote to the creditor with the CCJ with the notice of discharge and asking for them to mark it as satisfied (which IMHO they're obliged to do under the DPA). The creditor agreed and wrote to the court saying please mark as satisfied - the court actually removed the judgement completely (and it has gone from all the CRAs)!

 

Cheers

Michael

[Mr House]

Thanks, that is encouraging. I have already written and spoken directly with the court and the CRA (Experian) but not the creditor (HMRC)