One of the people we helped spoke to Keelin Shanley on the Today Show on RTE radio 1. In this clip you’ll hear her speaking to Rory about what lead him to use bankruptcy as a solution and his expectations for the future.
The Irish Times did the second installation of a person going through bankruptcy today.
Of note is how quick and effective it is on the day, the process is not surrounded with doom or darkness in terms of how the judge deals with people, it is humane, and brief, something to be commended as so much of the road to court 6 is paved with fear and harsh treatment.
We think Conor Pope did a good job of looking into a bankruptcy from start to finish, and wish to thank him for it.
The Irish Times did a story on a person looking to go for bankruptcy and mentioned us in the article.
Conor Pope did a great job of outlining the issues in general and in particular to Rory, but this line sums it “He owes €60,000 to half a dozen lenders including banks, credit unions and credit card companies – an absolute pittance in the scheme of things – but a debt of sufficient size to give him countless sleepless nights“.
While we can’t assure people don’t lose any more sleep, we can help them find a route to finality of the problem and that, rather than superfluous statements about social rights and wrongs is really what this all boils down to.
It is really unfortunate that upon bringing out new rules on bankruptcy that the cost of doing it went up! The costs will now be €650 for the official assignee (stays the same) stamp duty of €190 (almost doubles), €20 affadavit fee, then €50 to athe petition in ‘Iris Oifigiuil’.
The rump of the increase is in the stamp duty at the examiners office, this used to be €80 now it’s more than double that amount. The problem with this is that many people going bankrupt are on welfare and there is no simple path in some cases towards people on the dole being able to raise this money.
We have yet to see a case where it was impossible, often it means borrowing from relatives or getting friends to help out, selling a car or some other asset, but raising the costs just makes it that little bit tougher on people and means there is less money to pay for professional advice, something many of them would do well to obtain.
This week in a court presided over by Judge McGovern there were 11 self-adjudicated bankruptcies. The first six were represented by solicitors.
In the first petition, the Judge asked for proof of efforts to reach arrangements with creditors.
He emphasised that he needs to be satisfied that actual steps were taken to negotiate with all the creditors. The solicitor said they had included a letter from PIP stating that he had reviewed matters and the best options available was bankruptcy as they were below the income level for a PIA or DSA.
Judge McGovern said that a bald statement in the affidavit that reasonable efforts have been made is not enough. All unsecured creditors, not just the bank or main creditor, must be contacted.
In the first six cases, once the judge said he was happy to adjudicate the debtor bankrupt, the solicitor asked for three orders.
1.Order specifying the date of the statutory sitting
2.Order permitting the adjudication to be published on the ISI website as per the Companies (Miscellaneous Provisions) Act 2013.
3.Order dispensing with the requirement to …
There are new bankruptcies occuring and often in differnt jurisdictions to help resolve peoples indebtedness.
Some of the recent ones are Waterford developer Darryl Kavanagh who is looking for bankruptcy in the US. That case involves €17m of debt with assets of c. €4.7m. Shortfalls like that are hard to resolve other than with bankruptcy.
Closer to home there were some creditor lead bankruptcies involving two former spread betting executives. In this case the people involved were hoping to avoid bankruptcy sumons’s but the judge ruled against them and they were adjudicated bankrupts. Creditor petitions are still by far the most popular bankruptcy course, we are of the opinion it is because the general population has yet to see that it is a debt solution as well, not just some kind of punishment.
The alleged non-compliance issue regarding Paul Codd resulted in an arrest warrant which could have lead to a risk of further prison time but he now says he was coerced into giving his undertaking to avoid this because it could have resulted in him being there over Christmas.
His bankruptcy came about due to failure to satisfy a judgement in 2011 for more than a half a million euro. Mr. codd alleges that the police came and knocked down his door with a battering ram and it left his children traumatised.
His total estimated debts are thought to be close to €5m. What this story does is bring into focus some of the downsides of bankruptcy, in particular that of non-compliance, you simply can’t get around the decisions made by the Official Assignee.
An important aspect of bankruptcy is how the person deals with the Official Assignees requirements – your compliance makes a big difference. While a person can decide not to play ball, there are consequences to this.
One such example is Paul Codd the former Wexford hurler who spent a weekend in jail for failure to comply with orders surrounding his bankruptcy. His case focused on the failure to comply with an order to return leased machinery and he only avoided more prison time by promising to comply.
So when you are getting your advice (and we always advise going to professionals with relevant qualifications even if it isn’t us) remember that you are not getting a ‘get out of jail free’ card, in fact, messing about with your bankruptcy process will get you jail time in some circumstances as this case showed.