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UK-Justice
UK-Justice, Barrister
Category: UK Bankruptcy Law
Satisfied Customers: 16193
Experience:  Called to the Bar in 2007
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Hi, I recently received a letter from a solicitor quoting

Resolved Question:

Hi,

I recently received a letter from a solicitor quoting 'section 340 and 341 Insolvency Act 1986' stating that I was put in a better position than other creditors and asking me to repay £15,000, which was loaned to my brother.

In April 2010 I loaned my brother £15,000 towards his divorce proceedings. At the time I spoke to the solicitor conducting the proceedings directly to establish that I would get my money back, I was told that I would. The money was paid into the solicitors client account. Following the sale of my brothers property the £15,000 that was repaid by him.

My brother was made bankrupt by an order dated 27th February 2012 upon a petition presented on the 22nd of December 2011.

I initially replied to the solicitor acting on behalf of the official receiver, explaining the circumstances, including a letter from my brothers solicitor confirming receipt of the payment towards legal costs. There reply that the note my position but would most obliged if the payment of £15,000 was made as requested in initial letter.

Your help and advise would be greatly appreciated.

Yours sincerely,
Submitted: 1 year ago.
Category: UK Bankruptcy Law
Expert:  UK-Justice replied 1 year ago.
Thanks for your question, I will do whatever I can to help you. Please remember to rate my answer SMILEY FACE OR ABOVE.

Was it a gift to loan?
Customer: replied 1 year ago.

Hi,


 


It was a loan to pay towards for the solicitors divorce fee, otherwise they were going to stop acting for him. This was to be repaid on completion of the divorce, which it was.


 


So they are now stating they can go back over a period of 2 years prior to the bankruptcy loan.


 


Also not taking into account that if I did not pay the solicitors this amount, there would not be any money for them to try to reclaim. As well as the fact that this is my savings and I have benefited nothing from the whole episode.


 


I look forward to your reply.

Expert:  UK-Justice replied 1 year ago.
When was the loan paid back?
Customer: replied 1 year ago.

13th December 2011

Expert:  UK-Justice replied 1 year ago.
And was that in full or paid over a period of time?
Customer: replied 1 year ago.
Fully repaid.
Expert:  UK-Justice replied 1 year ago.
Thanks.

They are correct in that they can go back 2 years I am sorry to say.

But the circumstances should be that he knew or ought to know that he was unable to afford repayments and that he did not treat you equally with other creditors.

If there was no indication at that point then it should be ok.

However the OR would need to show you have been treated preferential.

If there you have any questions or if I can help you with anything else please let me know.


Please remember to click *** OK SERVICE *** or above so that I am credited for my time. The question does not close and you can ask follow ups.

Important: If you feel the need to rate as one of the lower two scores, it counts as negative feedback so please reply to me via the REPLY with any further questions you may have. I will be happy to assist you further.
Customer: replied 1 year ago.

In terms of the circumstance required:


 


1) He was trying to make repayments, they made him bankrupt (I do not know much about Bankruptcy but he told me this and apparently that is a difference)


 


2) What's the definition of preferential? If at the time he is paying them a small amount and then pays me off completely, is that preferential?


 


thanks again,


 


L

Expert:  UK-Justice replied 1 year ago.
In your 2 yes that is preferential.

It should be pro rata for each creditor.

If there you have any questions or if I can help you with anything else please let me know.


Please remember to click *** OK SERVICE *** or above so that I am credited for my time. The question does not close and you can ask follow ups.

Important: If you feel the need to rate as one of the lower two scores, it counts as negative feedback so please reply to me via the REPLY with any further questions you may have. I will be happy to assist you further.
Customer: replied 1 year ago.

What are my opinions and what can they do considering the fact that I spent the money last year?

Expert:  UK-Justice replied 1 year ago.
You can't so anything at this stage.

This is because it is up to the OR to take matters further.

The OR would need to take you to court and satisfy a judge you had been treated preferential.

It is it not for you to disprove its for the receiver to prove.

So at this stage you don't need to do anything

If there you have any questions or if I can help you with anything else please let me know.


Please remember to click *** OK SERVICE *** or above so that I am credited for my time. The question does not close and you can ask follow ups.

Important: If you feel the need to rate as one of the lower two scores, it counts as negative feedback so please reply to me via the REPLY with any further questions you may have. I will be happy to assist you further.
UK-Justice, Barrister
Satisfied Customers: 16193
Experience: Called to the Bar in 2007
UK-Justice and 2 other UK Bankruptcy Law Specialists are ready to help you
Expert:  UK-Justice replied 1 year ago.
I'm just following up with you to see how everything is going. Did my answer help?

UK-Justice

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