ste_5150
Established Member
Guys,
I'm wondering if anyone is able to offer advice, or past experience? This is purely on a personal level, so not related to any self-employment issues or payment for work or anything like that. Basically, I let money to someone a couple of years ago to help them out. They then repaid that money in July of this year (we're talking most of the way to 5 figures by the way), as I couldn't continue to fund it for them any longer. It turns out that they repaid it using credit, as they had no other option, and made a few payments but struggled a bit, so contacted the CCCS. Through them, they set up a payment plan, which one of the creditors wouldn't accept. The creditor continued harrassing them, to the point where they then decided to file for bankruptcy, which went through last month (november).
Herein lies the issue. The Insolvency Practitioner has now sent a letter to me saying that the payment to me could be considered a preference under section 340 of the Bankruptcy Act, and have asked me to contact them to arrange payment terms to refund the money and explain the reason for the payment. I am very worried about this, because I just bought a house, and I don't have access to that kind of money.
I have read that section of the bankruptcy act, and also section 341, which explains the definition of 'within a relevant time' and I do understand it but I'm convinced that, to the letter of the law, they could get away with it if they don't accept that it would be immoral to do so. I also know that the section states that they can apply for a court order to recover the money, not that I have to pay them just on the strength of their letter (which uses phrases like "may be recoverable" and "could be considered a preference" rather than specific reference to the fact that it is officially recoverable). I guess I'm asking for advice in any form, but more specifically once I have responded with a very carefully written letter is there any hope that they'll see sense??
Lastly, I know some may be tempted to put down the person I lent the money to, but believe me there are circumstances that sometimes really do justify people's situations, and bear in mind that I haven't explained that person's back story so you are not in a position to judge - I'm (rather desperately) looking for constructive advice towards resolving my situation.
Sorry for the long post!!
I'm wondering if anyone is able to offer advice, or past experience? This is purely on a personal level, so not related to any self-employment issues or payment for work or anything like that. Basically, I let money to someone a couple of years ago to help them out. They then repaid that money in July of this year (we're talking most of the way to 5 figures by the way), as I couldn't continue to fund it for them any longer. It turns out that they repaid it using credit, as they had no other option, and made a few payments but struggled a bit, so contacted the CCCS. Through them, they set up a payment plan, which one of the creditors wouldn't accept. The creditor continued harrassing them, to the point where they then decided to file for bankruptcy, which went through last month (november).
Herein lies the issue. The Insolvency Practitioner has now sent a letter to me saying that the payment to me could be considered a preference under section 340 of the Bankruptcy Act, and have asked me to contact them to arrange payment terms to refund the money and explain the reason for the payment. I am very worried about this, because I just bought a house, and I don't have access to that kind of money.
I have read that section of the bankruptcy act, and also section 341, which explains the definition of 'within a relevant time' and I do understand it but I'm convinced that, to the letter of the law, they could get away with it if they don't accept that it would be immoral to do so. I also know that the section states that they can apply for a court order to recover the money, not that I have to pay them just on the strength of their letter (which uses phrases like "may be recoverable" and "could be considered a preference" rather than specific reference to the fact that it is officially recoverable). I guess I'm asking for advice in any form, but more specifically once I have responded with a very carefully written letter is there any hope that they'll see sense??
Lastly, I know some may be tempted to put down the person I lent the money to, but believe me there are circumstances that sometimes really do justify people's situations, and bear in mind that I haven't explained that person's back story so you are not in a position to judge - I'm (rather desperately) looking for constructive advice towards resolving my situation.
Sorry for the long post!!