Getting caught up in someone else's bankruptcy

[Mike.C]

I take your point, Mike, but I think the thread has become a bit clouded in starting to talk about 'companies'.

On reading the first post, I don't see any reference to person B owing money to companies in a B2B relationship. I read it as a private indvidual maybe owing money to credit card companies, maybe the taxman, maybe the mortgage company etc.

So although person B might have had to declare themselves bankrupt in any event in the not too distant future, the fact that they took out a loan to pay off Ste (whilst extremely laudable and an honourable thing to do) could be perceived by the other creditors as trying to hide assets - daft though it sounds.

Ah Roger, now maybe I should have read the whole thread before I placed my post. After scanning through it, I was under the impression that this person "B" was running a company and except for Ste, all his other debts were to other companies. Now (although I still don't agree with it) I can see how others may think that there is a fiddle going on.

Ste you really should get professional advice.

Cheers

Mike

 

[BradNaylor]

I am not a lawyer, but I have enough experience of this area of the law to know that the situation is not as black and white as you have been led to believe by the insolvency practitioner you have been in contact with. Unfortunately, asking an IP for advice in a case like this is a bit like asking a gamekeeper for advice when you have been accused of poaching!

Karl and Jake pinpoint the nub of your case; it is all down to intent.

The IP handling your friend's bankruptcy will try to demonstrate that he was deliberately preferring you as a creditor, in a situation when he should reasonably have known that he was heading for insolvency.

You need to argue that your friend was acting in good faith when he made the payment to you, was in control of his finances, and could not have reasonably expected to have become insolvent. Indeed, that it was only the unreasonable demands of a single creditor that subsequently tipped him into bankruptcy.

Ultimately it is for a judge to decide. It is unlikely that it would ever get to court however, as that is rarely in either party's interests.

You need a good solicitor to act on your behalf in this. This rules out all small town high street solicitors who do little but wills and conveyancing; you need an expert.

I can personally recommend this guy in Chester. He handled a complex case for me over twenty years ago and was superb - the best solicitor I have ever used by a long way. This is his particular field of expertise.

I don't suppose he comes cheap, but it would be well worth an initial consultation at the very least.

http://www.aaronandpartners.com/public/ ... 50/231/240

You can email him directly from the linked page. I would do this outlining the full circumstances as per your OP and ask for his help. In my experience solicitors are very good at responding to approaches of this kind as they see an opportunity of landing a new client at the small cost of knocking out a ten minute email reply containing basic advice on how to proceed.

Cheers
Brad

 

[RogerS]

Ste...what Brad says re your 'typical high street solicitor' is absolutely bang on.

Personal recommendation such as Brads' is the only way to go IMO on something like this. If you go for the cheap option aka 'High Street solicitor' then you might as well kiss goodbye to any chance of reaching a satisfactory conclusion.

Blunt maybe but also based on personal experience like Brads'.

 

[Losos]

I would fight this tooth and nail, and would never pay the money back, just so that it can be given to a company/companies that can afford to lose it.
Cheers
Mike

Yes Mike, it all stinks doesn't it :?: The temptation to tell them to go to hell would be my theoretical view too :lol: but sadly Ste has to be practical, solicitors (so I'm told) might charge £163 per hour which given that Ste has said his loan was approaching 5 figures means that after about a week and half he would already owe his solicitor the same as he's being asked to pay back :roll:

I'm trying (and partly succeding) in getting out of the rat race and this is one of the reasons, fairness and honour seem to be things which no one carees about anymore.

As I was trying to emphasize in my earlier post, I could maybe understand if B had paid back A after he had gone bust but not before.

I really feel sorry for Ste, this has upset me, I was even thinking about it when I was trying to get to sleep last night :!: Of course it did no good I know 'nowt about the law and anyway I'm not even in England at the moment.

 

[Karl]

solicitors (so I'm told) might charge £163 per hour

Or they might charge more!

At the end of the day, an initial 1hour consultation with any good solicitor/insolvency practitioner should be free. Thereafter, he should expect to pay for them acting on his behalf. But I can't see any cicumstances arising in which it would cost him more than the original "debt".

Cheers

Karl

 

[BradNaylor]

If a good specialist solicitor thinks that Ste has a really good case, then I can't see why it should take more than a couple of letters to scare the IP off, or at least try to come to some sort of out-of court settlement. Even at £200+ per hour this is going to be worthwhile.

The bills only really start to mount up when things go to court. That can get scary. Fortunately this goes for both sides, which is why it is normally in everyone's interests to settle.