A minority creditor looks as if they will challenge debt of majority creditor

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shully
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by shully » Wed Nov 15, 2017 6:58 am
Hi. I am about to enter into an IVA but it looks as though the minority creditor wants to challenge the debt of the majority creditor. I have been trying to find information as to how this is done, timeframes involved, costs and also the likelihood that they will succeed even though the IP has confirmed that the majority debt is correct and ok. Thanks in advance of any help.
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Foggy
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by Foggy » Wed Nov 15, 2017 7:37 am
It depends on their reasons and grounds for a challenge. Are they disputing this creditors credentials or are they against the IVA in general (and know they don't have the voting power to stop it) ?
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shully
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by shully » Wed Nov 15, 2017 7:58 am
Foggy wrote:
It depends on their reasons and grounds for a challenge. Are they disputing this creditors credentials or are they against the IVA in general (and know they don't have the voting power to stop it) ?


So I have a certificate from the Beth Din of London confirming the debt to the majority creditor. The minority creditor is trying to question that debt by saying that it is not via a court. However, my IP has said that he will recognize it should the minority debtor force the iVA to be processed. The majority debtor has actually said that he is prepared to take the IVA sum as a lump sum without me having to fork out the cost of the IVA. Hence I am trying to get the minority debtor to do the same. But their response has been to question this majority debt...

So I just want to know if they are able to do this even though the IP has said it is correct? And if they do dispute it, how do they do it, how long does it take and what sort of costs are involved for all sides.

Any help or advice would be much appreciated as it looks as though today is d-day as to what I need to do...
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Lisa Thomas
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by Lisa Thomas » Wed Nov 15, 2017 10:46 am
If you are not proposing an IVA and trying to settle the creditors direct then you will have to satisfy the minority creditor enough for them to accept whatever settlement it is you are proposing.

If not then go ahead with the IVA and leave the Chairman to argue it out.
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shully
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by shully » Wed Nov 15, 2017 11:09 am
Lisa Thomas wrote:
If you are not proposing an IVA and trying to settle the creditors direct then you will have to satisfy the minority creditor enough for them to accept whatever settlement it is you are proposing.

If not then go ahead with the IVA and leave the Chairman to argue it out.


The major creditor has said that he is willing to accept an offer without the need to spend money on the IVA. I have proposed this to the minor creditor and their response is that they are disputing the major creditor. So it looks as though I am going to have to go for the IVA. What I really want to know is how can the minor creditor dispute a debt that the IP has accepted? Or are they trying to bluff? And what is the process that they must undertake? how easy is it to do this? How long does this take? what are the costs involved?

Thanks for all any any advice...
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Lisa Thomas
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by Lisa Thomas » Tue Nov 28, 2017 11:45 am
The key is why the minority creditor is disputing the majority creditor debt? I presume you are offering a pro rata debt.

How much is the minority creditor owed? If they don't accept then you can welcome them to make you bankrupt and let them know this will likely lead to no payment (depending on your assets).
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shully
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by shully » Tue Nov 28, 2017 12:05 pm
Lisa Thomas wrote:
The key is why the minority creditor is disputing the majority creditor debt? I presume you are offering a pro rata debt.

How much is the minority creditor owed? If they don't accept then you can welcome them to make you bankrupt and let them know this will likely lead to no payment (depending on your assets).


They are disputing the debt saying that it doesn't exist. They are being offered Pro Rata, yes. At the bankruptcy petition hearing last week, the judge adjourned awaiting for the IVA.. The majority debt is for approx 660,000 and the minority debt is approx 170000. They have been told that there are no assets and that bankruptcy would provide them with no monies at all..
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kallis3
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by kallis3 » Tue Nov 28, 2017 1:47 pm
Curious to know why the Beth Din is involved?
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shully
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by shully » Tue Nov 28, 2017 10:04 pm
kallis3 wrote:
Curious to know why the Beth Din is involved?


The Beth Din have provided the documentation confirming the debt
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Lisa Thomas
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by Lisa Thomas » Wed Nov 29, 2017 10:26 am
I suspect you can easily prove a debt of £660k to the minority creditor!

What does it relate to?

Jew

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shully
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by shully » Wed Nov 29, 2017 11:38 pm
Lisa Thomas wrote:
I suspect you can easily prove a debt of £660k to the minority creditor!

What does it relate to?


Hi Lisa

I didn't understand? The debt is documented via an official letter from the Jewish Beth Din. Its for an unpaid loan.
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Lisa Thomas
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by Lisa Thomas » Thu Nov 30, 2017 12:47 pm
and presumably there is a paper and financial trail showing the loan being paid in to your account, which should satisfy the creditor that the debt is genuine.
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shully
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by shully » Thu Nov 30, 2017 12:55 pm
Lisa Thomas wrote:
and presumably there is a paper and financial trail showing the loan being paid in to your account, which should satisfy the creditor that the debt is genuine.


There is, yes. But as far as I have been advised, I am under no obligation to show it as the Beth Din document is accepted by the UK courts and this document should suffice to prove the debt?
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Lisa Thomas
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by Lisa Thomas » Thu Nov 30, 2017 3:23 pm
Of course you don't have to show them anything but given they are causing you agro because they feel you are using a trumped up claim as an attempt not to pay them in full I think if you showed them the evidence you might just be able to move forward.
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shully
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by shully » Thu Nov 30, 2017 9:14 pm
Lisa Thomas wrote:
Of course you don't have to show them anything but given they are causing you agro because they feel you are using a trumped up claim as an attempt not to pay them in full I think if you showed them the evidence you might just be able to move forward.


Understiod. My solicitor is advising against doing this until such time they decide to protest the IVA and take it to court...especially as the IP has accepted it..
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