Questions you have before making a decision to go Bankrupt and the Bankruptcy process

Moderators: TalbotWoods, JaneClack

By Ryan
#359 In March 1992 I was made bankrupt with debts of £21k. Approximately one week after the hearing I meet with the Insolvency Service in Reading and was told by them that a Trustee in Bankruptcy would be appointed and would be in contact with me within 6 months. I was not contacted and called the IS many times in the period up to early 1994 only to be told that they were behind, they were too busy, and that once they got paperwork sorted would be in contact with me.

I never heard any thing else until April 2003 when I received a letter from the IS offering the opportunity for myself or a third party to buy out the interest in my property for £25k. I confirmed that I wanted to accept this offer. The IS then discovered that the property was up for sale and that my share of the equity was approx £100k - everything then changed. A Trustee in Bankruptcy was appointed who told me that they would take 'most of that'. Since then I have received various completion statements. In April the value was £81k which was included in court and used in my divorce settlement. The property has now been sold and my share of the equity in a holding account with my solicitor. The TIB's latest statement is for £101k, made up of the original £21k plus £14k they added to make £35k, plus £35k interest and £26k in costs. I have two weeks to respond.

I would appreciate your advice on how to respond particularly relating to the lack of information immediately after the court hearing, the delay in contacting me, the interest incurred (8% for 12 years so far), the changing amounts and so on. I had no idea this debt was building up and feel very aggrieved not to have had this explained to me at the outset. have I a case against the IS over this?

Thank you for any help / advice you can offer.
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By JaneClack
#374 :( Oh I can understand how cross you must feel. But I am afraid that the Trustee is within his rights. What has happened is that with the changes in the law that came in with the Enterprise Act on 1st April 2004 was that the beneficial interest in a property now only remains with the Trustee for 3 years from the date of bankruptcy and, however unfair this seems for previous bankruptcies (where before the beneficial interest remained with the OR in perpetuity) the beneficial interest has to be dealt with by 31st March 2007. This is why a lot of cases have been got out from archives to ensure that they are dealt with. I have known cases in the past where the bankrupt was allowed to remain in the property as there was little or no beneficial interest and later they had invested in the property and with the normal passage of time the value of the equity increased where the OR as come back 12 years later. At least this cannot happen any longer. The OR is also adding the costs for his so-called "monitoring" of the case since discharge. By this time what he is trying to do is recoup his costs (not cheap as they are since 1992) and anything over he can get for the creditors. It seems iniquitous but unless you can prove you were not offered the right to buy the beneficial interest at the time of the bankruptcy when you could try to counter claim for maladminsitration I am afraid the OR has the right of it. Sorry. :evil:
By Belly-Up
#1596
Sarah wrote: It seems iniquitous but unless you can prove you were not offered the right to buy the beneficial interest at the time of the bankruptcy when you could try to counter claim for maladminsitration I am afraid the OR has the right of it.


Has a maladministration judgement ever been made against the OR?