Made Bankrupt - how to overturn it?

[ivorbiggun]

seylectric,

 

My dad was faced with bankruptcy a few years ago with a stat. demand from the Inland Revenue. My experience from using insolvency solicitors are that they are all very vague and reluctant to commit to any fact or decision. A lot of the time they said that it "would depend on what side of the bed the Judge got out of that morning". Great!

 

I think you need to speak to a more proactive solicitor - there are some out there, but the problem is finding one. Most general solicitors deal only in conveyancing, contract law and estate planning. Very few seem to have any experience of insolvency/bankruptcy. Even some insolvency specialists will pass your case onto a trainee and only oversee the case.

 

My dads experience was brought on because the Inland Revenue "failed to allocate a payment to his account". This mistake cost him £4k in solicitors fees, £2.5K for his accountant and various other costs with virtually zero chance of reclaiming it. Unfair - yes. Abusive process - yes.

[seylectric]

I am still concerned about the lack of paperwork on your file but if that's what you've decided to do then I wish you luck and hope that it's all sorted soon.

 

I think you probably could fight this on the grounds of incorrect procedure but I can see where your lady solicitor is coming from and her route could well be the least expensive in the end; your position is weakened by the five Liability Orders going back to 2002 which are listed on the Satutory Demand.

 

Having given it an awful lot of thought I do believe we have a strong case but there is a deciding factor in our decision and that is the fact that if the OR appoints a trustee ahead of us doing so, which he must do within 12 weeks but I am told this is usually done pretty quickly, it will cost us fortunes. Trustees fees have been quoted at anything from £3,500 to £20,000 and apparently once appointed there is little we can do (again!).

 

As hard as it is to accept, it would appear to make sense to go ahead with the solicitor's advice at this stage and get someone professional onside; if we have to pay out I would rather pay someone who is on our side. The specialist solicitor I spoke to last night deals with everything, it's expensive at £4500 but it's a flat fee so at least we know where we stand, she is definately pro-active and confident and deals with nothing else except bankrupcy.

 

If she says we are unlikely to win I feel I have to put my anger to one side and listen or it could cost us a whole lot more. We have therefore decided to go down this route to get everything paid off and the bankrupcy annuled, after which I will then be considering ways to get some sort of compensation for our costs.

 

I still believe that even if the server did stand up in court and say he made a mistake, the fact is he did so under oath and that must count for something but unfortunately nobody I speak to who supposedly knows about these things seems to agree and if we lose the cost is too great. Looking at it practically if the bankrupcy is eventually annuled this way when everything is paid off it's still a result of sorts.

 

I'm not happy about it by any stretch of the imagination and I will be reporting it to the press, my MP, BBC Watchdog and anybody else I can think of at least as a warning to others, but this is wrecking us and sometimes you just have to accept that life in UK.plc isn't always fair and move on.

 

Luckily most of our available cash is in my accounts so the receiver won't get his paws on that, a remortgage to pay off everything will probably cost us an extra £100 a month or something but at least it clears everything and gives us a fresh start so in that respect it's not that big a deal. That's the way I have to try and look at it anyway for my own sanity.

[seylectric]

Thanks for your comments ivorbiggun, I'm learning the hard way that once the authrities have you by the short and curlies there isn't much you can do whether they have acted legally or otherwise. It all really comes down to having the funds to be able to afford to hire a big city lawyer to fight them, and most of us haven't or we wouldn't be here.

[seylectric]

Just thought of something, which depending how you (or the courts) look at it, could be significant:

 

A few months ago we applied for (and were granted) a secured loan to clear off some debts and do some much-needed work on the house. Given that the council had previously declined our offer of part payment and instalments this was done with a view to clearing the debt.

 

Since we couldn't get any sensible reply to our offer to pay in instalments except for the fact they said "it was too late", we decided not to go ahead with it until we heard further from the council.

 

However the significance of this is surely that it proves that we WERE in a position to pay prior to the court hearing? Any mileage in this?

[bottomburp]

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[seylectric]

Sorry about the delay, having connection probs (stuck with a dialup connex for a few days yet), got a hundred other issues to deal with and my head is all over the place.

 

We had a meeting at home tonight with the firm that the solicitors deal with re. remortgaging to pay everything off to get it annuled.

 

State of play re. costs:

 

Original debt to the council (inc. costs) : Just under £4,000

OR's fee: £1,650

Solicitors fee: £4,500 + VAT

The firm that deals with the remortgage: £3,500

Cost of court case to have the thing annuled: £1000+

Valuation fee (for the remortgage) : £450

Pay off other debts (necessary to have the bankrupcy annuled) : £2000 approx.

Cost of putting the forms in for the annulment: £65

Early settlement penalty from the mortgage company we are currently with: £5,000

 

Total so far: £23,000+

 

Add to that the extra interest over the term of the remortgage and you can probably double that at least!!!

 

I am told that an appeal on the grounds that it should never have been made will cost me upwards of £3,000, and if it fails (which we keep being told it probably will) then we will be back in the position of having to go through the above procedure anyway and it will have cost us even more and prolonged the agony!

 

I just don't know which way to turn, or what to make of it all. I'm at my wits end at the moment and still trying to make sense of it all.

 

There has to be a better, cheaper way? This isn't right.

[bottomburp]

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[Seminole]

Can I say at the outset that I share your sense of moral outrage at what has happened here. So called "public servants" have set out to recover a debt in a way designed to try to ruin your lives. They have employed what appear to be rogue agents to do so. You have every right to be angry and it's only natural to seek to overturn this appalling behavior.

 

Unfortunately what you are coming up against is a system that is designed to make life as difficult for the individual as possible. You are dealing with bureaucrats at the council who don't like being accused of being wrong. bailiffs/ process servers who are legalised thugs and an insolvency system that is designed to extract money from its victims at every level.

 

Having said all that I don't know if you have managed to take a step back and look at the other option which is to accept the bankruptcy, work round it and seek retribution in other ways. From my own and others experienced I decided some time ago that it is usually pointless to fight the state directly. They have all the cards and they quite like squashing those who have the audacity to think that they should behave like servants rather than masters of the people.

 

I realise that this may stick in your gullet but I think you should do the maths. What is your house worth? What is the outstanding mortgage? What is the total value of the debts included in the bankrupcty? Could you raise a mortgage in your own name to buy the house from your wife? At the end of the day these are nasty questions but if you emerged from this situation with most of your debts paid off or cancelled then could this be a good thing in some ways? There is no social stigma associated with bankruptcy these days and your partner would be likely to be discharged in perhaps a year. Believe me I don't like suggesting these things but it may be the easier path.

[JonCris]

Whilst I agree with seminole & it doesn't help now I think they way you have been treated amounts to maladministration & an abuse of process You should contact your local council member followed by your MP to make a complaint to the Local Government Ombudsman.

 

If more people complain in this fashion them the jobsworths might think twice next time. I think this particulary applies to Blackpool Council because as I recall there are many issues going on there which require investigation such as there complete disregard for the law in the matter of parking enforcement to name just one.

[Seminole]

One minor point is that anyone can make a complaint to the Local Government Ombudsman. It's only the Parliamentary Ombudsman where the complaint has to go through the MP. I completely agree that this is the way to go although seylectric would probably have more joy with their MP than their local councillor.

[JonCris]

Yes sorry didn't make myself clear Thats why I referred to both avenues & still think he should go down both routes

[bottomburp]

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[JonCris]

Well done bottomburp

 

It's about time you had a bit more rep

[Seminole]

Well done bottomburp

 

It's about time you had a bit more rep

 

Done in a super-mod stylie.

[bottomburp]

Thanks guys, I don't know what to say!

[JonCris]

Say nowt! just enjoy

[seylectric]

Thanks again for all your help. I'm going to print it out and mull it over.

 

I'm not sure what is meant by "substituted service", and if that's what actually happened to us in this case. I'm concerned about "time" and "cost" (either way) here, although getting the application in would at least buy us some time.

 

I'm definately not happy about the solicitors costs etc, seems to me like everybody is just out to fleece us and that we're unwilling victims in the whole thing.

 

The parking ticket thing is just one of the farces that goes on in Blackpool, I'm less concerned about that issue at the moment but I got a letter from Phoenix (the bailiffs) this morning which begins "Whilst it is not our policy or desire to create hardship and distress at this time of year......"

 

AHA!!! So they ADMIT that what they do causes distress, and isn't knowingly causing somebody distress an offence? (Note: Basically they have knidly offered to accept half of what is owed and collect the rest in the New Year. How kind of them!

 

They go on to say in capitals "IF NO PAYMENT IS RECEIVED RECOVERY ACTION WILL CONTINUE THROUGHOUT DECEMBER" - so no qualms whatsoever about continuing to cause distress at Christmas then! It beggars belief!

[bottomburp]

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[seylectric]

I've gotta go back to the court office. Those dozen or so papers I emailed you recently were EVERYTHING that was given to me by the court office and I did ask, verbally and in writing (I also asked them to place a copy of the request in the file), for copies of everything that they had on file relating to the case. As you know BB, there wasn't much of it!

 

If a substituted service application was filed they MUST have more than this, I've been puzzled from the start about the lack of paperwork on file relating to this case.

[bottomburp]

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[seylectric]

So basically I should be asking the court office for copies of a witness statement, although isn't pages 9 and 10 of the items I sent to you a witness statement? - and a "substituted service" order?

[bottomburp]

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[seylectric]

Brilliant, thank you.

[seylectric]

Sorry, been manic busy lately but here's the latest:

 

I went to the court office on Friday only for a puzzled clerk to come back to me to tell me that there are NO papers in the file!!! I said I would call back on Monday afternoon either for a copy of the papers or an official letter stating that there are none!

 

wtf is going on???

[JonCris]

It looks like you have been stitched up. That the court has accepted the word of someone & allowed substituted service without checking a 'statement of truth'

 

Anyway wait until you hear from the court