IVA breach & frightened

[scottm]

We have had an IVA since February 2006. Earlier this year we sold our house. Our solicitor had been made aware of our IVA and on completion the proceeds of £8900 were sent to us. Some of the funds were used to back back friends & family money we had previously borrowed prior to the IVA.
It was not until we received a letter from our solicitor that the proceeds should have been sent to our supervisor and also the land could not be registered in the new owners names. Our understanding was that we had to inform our supervisor if we sold the house, and were unaware prior to this that any windfall had to be given to them, although are now aware that this was in the contract.
We have had several conversations with our IP who advised at the time we had to pay the windfall in one lump sum. We are not in a position to do this and requested verbally and in writing that consideration be given to increase our payments to pay.
We received a breach of notice earlier this month and have responded back again to advise that we are not in a position to remedy the breach in one lump sum.
We are really frightened of the impact that this will have and what will happen. ie bankruptcy. We just cannot get the money. I have been told they could barnkrupt our friends and family for the money we gave them. Could we lose our jobs, we are both in a middle management position, could we be sent to prison, could we be evicted from our rented home, I have read articles about BRO /BRU's???? its scrambling my brain. I would be grateful for any advise that anyone can give.

Thank you
Scott

[MelanieGiles]

This is the third time I have seen this post tonight Scott? Are you having problems with the site, or are not happy with our replies?

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

To have me propose an IVA for you, please visit:
http://www.melaniegiles.com/ivaEnquiry.asp

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp

[catullus]

The sites been subject to spamming recently Melanie which might be the issue here.

[ray_a]

Hi

Sorry not to have replied earlier due to pressure of work!

This is very serious and basically I think the Lawyers have messed up because your house should have had a restriction and BOTH solicitors should have picked this up when they did their searches. I can see a potential legal case just on this point!

The fact that your solicitor sent you the money means that the sale went through.

Unfortunately like me after selling my home you are still under the supervision of your IP until you get a certificate of clearance.

Your IP is correct in claiming the money back from you and like me it could be that you were also liable for statutory interest.

The IP can go back to those who received monies to recover them but I also think that some good sense is required. I would have thought that your other creditors might have recourse against your solicitor for not picking this up initially.
I think that is pretty obvious.

If I was in your position I would request that the IVA is varied and you agree to make some further contributions to make up the loss.

Failing that then I suspect we are heading for the courts to get a legal decision as to the best way forward.

I would try and get a meeting with your IP to see what can be done.

This is interesting and do keep in touch as I am sure as a site like my problem earlier in the year we can get this sorted and get a result.

Persobnally I do feel for you and very sorry about your situation and will be more than happy to support you in any way I can!

Good Luck and Regards

Ray

[scottm]

Hi Melanie, sorry, I am not used to how to post and got a little confused. My apologies, was not my intention to confuse other people, or appear that I was not happy with replies.
Ray, thank you for your post. Much appreciated. We have contacted our IP twice about making further contributions but they have not acknowledged this, we just received a breach. We are both very worried about this and the impact that this could have. I have asked previously about any recourse on our solicitor and was advised that it was not up to them. We are both just ver concerned at what the next steps would be. Thanks again everyone.
Scott

[scottm]

post from Catullus.
Posted - 16 October 2007 : 23:51:38
--------------------------------------------------------------------------------

Hello Scott

I'm struggling to know how to reply to your post because you seem to have got yourself in to a real problem and its difficult to understand how.

It certainly sounds as though your solicitor has let you down but what I struggle to understand is how you thought that you had the ability to sell the house without the authority of your supervisor and why you thought that it was appropriate to repay friends and relatives who presumably were left out of the IVA?

All of these issues are really quite serious within an IVA and should have been spelled out to you repeatedly by your IP in the lead up to your IVA which is why I cannot understand how this has happened.

What is done is done, however, and if you cannot remedy the breach the supervisor will have no option other than to call a creditors meeting with a view to terminating the IVA. That will put you back to where you were originally with your creditors and although it may take them some time to catch up with you, the pressure will surely recommence at some time.

If you then decided to take the BKR route
it is very possible that the OR would ask you to agree to a BRU in view of the breaches in the IVA but you certainly would not be sent to prison. As for your employment its difficult to say what effect there could be on it without knowing more about what you do.

Reply from Me
Sorry, I got confused with the posting method. my apologies.

When the initial creditors meeting occurred in FEB 06, we specifically asked whether we could sell our home. We were advised at the time that this can happen as long as we inform our IP when we move as other individuals had done this and not informed them. This was not something we wanted to do. We were not told at this time that we had to have permission first or that any monies would have to be paid directly to them upon the sale. We were very open with our solicitor that we were in an IVA and it wasnt until we were advised by our solicitor of the error upon completion. When we entered the IVA we mentioned the money owed to friends and relatives and were advised that this was not counted. We paid them the money back as we felt this was the right thing to do.
We have contacted our IP twice regarding increase contributions as we are unable to remedy this situation now.
With regards to our jobs we are both with big companies, I am a telephone manager within a customer service department and my partner is a systems support manager.

Thanks for your help,
Scott

[douglass]

Scottm, regarding your employment, it would depend on your job role. For example, if you are regulated by FSA etc. You would really need to discuss it with your senior management. I am middle management, and I have (thankfully) been allowed to keep my job. Good luck. D.

[ray_a]

Hi Scottm

Must admit that there are a lot of things that need to be clarified.

Did the IP get you to sign a document giving an interest in your property. The reason I ask this is that it has to be filed with the Land registry and therefore both solicitors should have checked this.

You have said that you advised your IP that you were moving and did you tell him at the onset as when we sold ours I told them so that I could get a settlement figure! Another story about how I got three different figures varying by £10,000!

As for your IP not contacting you I would write a final letter requesting a meeting and if he doesn't then I think a referral to his professional body will be in order.

The other worry I have with this one is does your Ip have a clause to bankrupt you in the IVA?

Sorry for the questions but it will help to come up with some suggestions.

Looking at your occupations I don't think you need to worry about bankruptcy and as longing as you keep your rental payments you should be save!

Take care

Regards

Ray

[tracy.h]

Hi Scott
I don't really know a lot about br,i just wanted to say i hope you can find a way through this,it must be a very stressfull time for you and your family right now.
It seems you are getting exellent advise,from other posters and i hope this will help you find a way forward.
Good luck

Tracy

[Soulgrowth]

Just wanted to reinforce Tracy's good wishes Scott ... to every problem there is a solution ... somewhere.

All the best

Debbie

www.babynamings.co.uk

www.soulgrowth.co.uk

[MelanieGiles]

Hi Scott

Please don't feel the need to apologise for the postings - I did the same think myself the other day and then felt a complete idiot!!

It is hard for both Catullus and I to advise you on the forum as we do not have access to the original IVA paperwork which will contain the answers to your problems. Also, I have to say you do not appear to have been properly advised by your IP, if you would told to ignore family debts.

Given that you have now been served with breach paperwork, can I suggest that you make an appointment with a local solicitor with knowledge of insolvency matters to see if indeed a breach has occured. If the asset was not included within the IVA, then the money from the house sale is yours to do what you like with. If, however, the asset formed part of the IVA, then you will need to rectify the breach quickly to avoid your IVA failing.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

To have me propose an IVA for you, please visit:
http://www.melaniegiles.com/ivaEnquiry.asp

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp

[ray_a]

Watching this one with some interest but in fairness to Scott when I had my problem i found it very difficult to find a solicitor who specialised in IVA's when I had a problem with the statutory interest a few months ago.

Basically with the support of this forum, my limited knowledge from my solicitor who was very helpful and given that I have a lot of experience with financial matters I was able to come up with some sensible solution which worked.

Does Melanie know any solicitors who specialise in bankruptcy please?

This would obviously be the best way of dealing with this problem.