I was in a property based IVA. one of the creditors was our childs private school. They told us to leave him in the school after the IVA was finalised. (he was in his gcse's)They agreed verbally that any cost would be settled after the property had sold out of any surplus. 4 years into the IVA they changed there mind and applied for a charge on the building. Our IP (TENONS) told us to sign a form stopping the charge going ahead. It turns out that the form was actually to allow Tenons 2nd charge on the property for £16000. Since then the IVA failed and low and behold Tenons bill for the IVA is £16000 pounds. This along with the schools 3rd charge of £11000 has completely messed things up. my main question is " are Tenons allowed to take a charge on the building thats in an IVA and is £16k a fair sum for an IVA which comprised of 1 creditors letter per year and 1 x 30min meeting per year" The property is now up for auction and because of this will will struggle to pay off our other creditors.
Hi Ian and welcome to the Forum.
It is difficult to answer the question without the full facts and legal advice may be better. However, it does seem strange that the school got a charge for £11,000 after the IVA was approved as this seems excessive if your son only remained to do his exams. If it was for the next two years while he did his A levels this would make more sense as it would be a post IVA debt.
The voluntary charge you must have signed for Tenon should have been quite but and it may have been advisable to take legal advice at the time. The amount of fees does seem high but I do not know the complexity of the case or the amount of hours spent on it.
It may be worth seeking a meeting with the IP and asking for an explanation. Also if there is now to be a shortfall to the other creditors and you do not have an IVA in place how are you going to address this issue?
Thank you for your reply.
The external to the IVA school debt was for the 16 months before his gcse exams. He had been at the school since age 3 (school nursery)and they said that if he was moved it would have a detrimental effect on his results, I now feel as though we were morally blackmailed over this issue. Because they now have a charge for £11000 external debt, By doing this they have Jeopardised there debt (a further £12000) and everyone elses that were covered by the IVA.
Our IVA was infact a very simple IVA. We have a business property that was put up for sale at the start of the IVA. The creditors would get paid when the property sold. That was it, no monthly payments or any of that kind of thing, just a simple sell and reimburse situation. All the IP had to do other than set it up at the start was to send out a letter (lack of progress report)once a year to the creditors and have a couple of half hour meetings (once every 2 years) for us to explain why the building hadnt sold yet. Now the IVA has failed we have put the building up for auction (27th July)The plan is that after all the charges have been settled any surplus will be offered to the ceditors on a Penny in the Pound basis.
Was the debt to the school included in your IVA? This does all seem very odd indeed - and Michael is correct to steer you towards legal advice. It would be highly unusual to take a charge over a property as IP of an IVA - and you should try and understand why this was done as this all seems to have left you worse off than when you started.
