Bankruptcy and medical negligence case

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Beryl.01
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by Beryl.01 » Thu Jun 22, 2017 9:29 pm
My daughter has won a medical negligence case and was made bankrupt during this time. She is unable to work and has had two further surgeries. The solicitors hold the fund. The amount of the bankruptcy was £56,000 plus 8% interest plus £10,000 charges by the OR. However she is expected to pay an extra £40,000 in tax to the OR and perhaps more. The bankruptcy will be annulled as all creditors will be fully paid. My daughter is going to lose her pain and suffering payment which I thought was protected. She will receive a nominal payment for losing her fertility, needing surgery for life and suffering terrible pain. The OR keeps 75% of the claim even though creditors are paid with interest , they seem to have no conscience about taking money which was to help her throughout her life. The bankruptcy with interest is £70,000, but they are keeping £250.000. She will receive £70.000. Can they do this? Is there any appeal?
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Michael Peoples
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by Michael Peoples » Fri Jun 23, 2017 8:23 am
Your daughter needs the help of a specialist solicitor and possibly an insolvency practitioner. Firstly, if the debts are repaid by her solicitor she avoids the DTI ad valorem tax as the money does not go to the O.R. Her solicitor can then apply for the annulment after the debts have been discharged. Secondly, it may be better for her to remain in bankruptcy and just hand over that part of the award which is not exempt and this may save her a lot of money.

Finally, your daughter could even propose an IVA whereby a percentage of the money goes to creditors, statutory interest is removed and she retains what is exempt and needed. If creditors approve this the bankruptcy can then be annulled and she may not even need to be repaying in full.
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Foggy
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by Foggy » Fri Jun 23, 2017 8:26 am
I agree with Michael in that your daughter should seek independent advice from a specialist solicitor and / or at the least an IP conversant with BR and compensation claims.
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Ryan
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by Ryan » Fri Jun 23, 2017 10:34 am
I would echo the thoughts of Michael and Foggy, with the sums being mentioned it's definitely worth getting some Legal Advice on this initially before committing to anything
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Beryl.01
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by Beryl.01 » Sat Jun 24, 2017 10:00 am
Hi. Thank you for your reply. The OR didn't give my daughter more than 24 hours to negotiate. She has legal advice but I thought two heads are better than one. It appears to be too late. She has to pay the fees of the Secretary of State. This case has been running for over five years, so a lot of costs from the OR. It seems she will lose a substantial amount and it is all legal. It a pity that there government are able to take such a huge amount without redress and no one to complain to. Thank you for your advice. Her solicitor attempted to use it but was told someone would have to put that amount in cash as the money has been assigned by the OR
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Beryl.01
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by Beryl.01 » Sat Jun 24, 2017 1:15 pm
Given the complications of this case I can't expect you to come up with instant answers. However my daughter has had legal advice for years with this case, and the OR has been involved from the beginning. I think though that the insolvency department of the solicitors were not involved early enough and she has been put in a position of having to make uninformed decisions under pressure from the ORs solicitors in a very tight time constraint. In other words not to her advantage. The funds are being held by the solicitors awaiting apportionment. It may be too late to do anything. In this case is there any way to ask if this has been handled by the ORs office competently, and is there a process that can be used to ask these questions? I would be grateful if anyone can tell me.
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Michael Peoples
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by Michael Peoples » Mon Jun 26, 2017 8:01 am
If you are unhappy you can complain and there is a process. Ultimately you can go to the parliamentary ombudsman if you get the local MP involved so perhaps you should start the process now before the funds are distributed.

https://www.gov.uk/government/organisat ... -procedure
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Lisa Thomas
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by Lisa Thomas » Tue Jun 27, 2017 9:36 am
Is her solicitor a specialist in insolvency?

If not I recommend she speaks to a different solicitor - I can recommend if needed.

If annulled on payment in full basis I think the tax can be reversed.
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