Problems with an IVA and Accuma not solving debt problems. This blog was my personal diary of debt and my problems sorting the debt out. But I feel I must include this debt story.We chose the payplan Debt Management Plan rather than an IVA. mainly because we didnt have enough money for an IVA. This particular couple opted for an IVA but were unable to keep up with the payments.Despite constantly contacting Accuma they got no response until it seemed they would be forced into bankruptcy.I dont know the legallities of all this or at this stage where it will end. I am but relaying the story so far.They were told they would have to sell their house to release the equity to pay off the creditors unless they could get a third party to come up with the equivelent amount. This they duly did but Accuma said the creditors had rejected this amount. What happens next? Nobody could come up with a suitable answer. Could they appeal. Accuma told them no. It is now nearly three months since they heard from Accuma In desperation they phoned the National Debt Helpline (Which I must say I have found absolutely superb and so helpful)National Debt Helpline told them to insist Accuma responded.
The position at the moment, they have now been told that only the wife is being made bankrupt despite the fact they had added all the debts together. The wife, by the way ,of the two of them owes the least,and has no assets. She has been told that the procedure is well in place and there is nothing she can do. When they questioned this (RE the debts being separated) they were told it was in the fine print. They are as we speak trying to sort this out. Surely they should have been notified,? who is at fault here? Why was there no communication?
If anybody out there has had a similar experience please post a comment.The pressure of being in debt is so bad and to be further pressured by people who are supposed to be helping you causing more problems.
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If anyone fails to keep up the payments on an IVA they should have been served with a default notice. The terms of the IVA should say what happens in the event of default. It used to be a standard clause that, in the event of default, the supervisor of the IVA (i.e. the insolvency practitioner employed by Accuma) should petition for the debtors bankruptcy. There is then provision within s.276 of the Insolvency Act for the court to enquire into the reasons for the IVA failing.
To avoid scrutiny by the courts, it now seems to be increasingly common for the terms of IVAs to specifically state that the supervisor should not petition for bankruptcy in the event of the IVA failing.
In the case you refer to it sounds as though there are two IVAs - one for each of the partners - but if both parties have failed to keep up payments (for whatever reason) then both should be in default.
If it seems that the supervisor acting for Accuma is not giving positive advice or taking any actions then it is possible to apply to the County Court under s.263 of the Insolvency Act asking the court to instruct the supervisor to take appropriate action - but this may work against the debtors' interests because there seems to be some evidence that the IVA factories may simply be doing nothing if an IVA fails. In which case, it's possible to just shut up and wait to see what happens.
However, by law, the supervisor of an IVA stays in office (and the IVA continues) until the supervisor has provided the debtors and creditors with a final report and accounts which also has to be filed with the courts in accordance with Insolvency Rule 5.34.
Accuma's insolvency practitioner's have to provide a final report by law. If they fail to do so, the debtors can apply to the court under s.263 (download form N244 from the HMCS web site) asking the court to order them to provide a final report. This should be a win/win application but take legal advice first quoting the sections I've referred to here - many solicitors provide one hour's free legal advice.
Links to the relevant sections of the law can be picked up from my blog at http://voluntaryarrangementmole.blogspot.com/
Thanks to riters bloc I think the persons I wrote about are going to check your blog.
For specific advice, I would recommend talking to CCCS - the Consumer Credit Counselling Service.
The IVA forum on IVA.co.uk is also a useful place to post questions but exercise some caution because Accuma and their subsidiary Thomas Charles are both actively engaged with that site.
It's also important to complain about the insolvency practitioner (IP) who is supposed to be supervising the IVA rather than Accuma as a company.
IPs are required to deal with problems and queries in a 'timely manner' and three months uncertainty is not timely.
Lodge a complaint with the individual IPs professional body about the delays in dealing with the problems with the IVA.
Thanks for the advice riters bloc. its a very complicated situation we are currently in.we set up a joint iva in 2005, failed to make payments after a while. we kept accuma informed of our change in circumstances constantly with no reply off them ( luckily we have kept all correspondance we sent). eventually when our IP did get in touch with us she told us we would have to sell our family home to release the equity until she found out there was about £5000 in equity!!! she then blamed us for sending in a false valuation on our house until we told her we went with the house prices at the time like she requested. she did admit accuma should have sent a surveyer out themselves to get a true valuation! 1st mistake!!!
she then informed us you have no choice but to go bankcrupt so we then asked for a creditors meeting for a variation in terms i.e full and final settlement ( bare in mind not once did she seperate our iva or inform us it was treated seperatly) we made an offer which was then rejected so we asked for another meeting and she agreed. uping our offer, this was also rejected according to her. we have just discovered that any creditors meeting held must have a chairmans report filed to the courts and ourselves. we only recieved 1 chairmans report with our original offer on it therefore we think she did not convene a 2nd meeting. so we have now requested all information regarding the 2nd meeting to see what lies she comes up with next.
we also found out that if a meeting is requested from ourselves, the meeting needs to be held within 21 days of the request, our 1st meeting was 5 months after our written request!
it gets worse...
the last time we heard from our IP was the beginning of january this year she told us the 2nd offer had been rejected and we had no other option but for accuma to file for bankcrupcy for both of us, leave it with me she said i'll get back to you and inform you whats happening once ive looked at your file....
So this takes me up to monday this week, we got in touch with the national debtline (who are great) as we wanted to move on with our life but didnt know what to do about accuma, they told me to phone them and tell them i want an answer now about whats happening to us, so i did.
the response i got was and i quote " yes, i think we are going to make you both bankcrupt". she then went on to tell us that we will lose our house and she will become trustee, which we now know is bollocks!!!
keep reading it gets worse...
2 hours later my husband got a call from another person in accuma saying im sorry but your iva has failed we will be sending you a breech of iva and we will be filing for bankcrupcy for your wife. my husband was gobsmacked.
it turns out that in my husbands modifications there is nothing stating anything about bankcruptcy but my modifications state after 3 months of default accuma has to automatically file for my bankcruptcy.( we stopped paying 18 months ago) we have had no default letters sent to us and our IP has never once informed us of this information.
We have put a complaint to our IP outlining all of her faults, we have scrutinised the terms and conditions and found she has broke about 5 of the rules of an IP.
the one that confuses us the most is, if these modifications have always been in place then how could she call a creditors meeting knowing about the modifications, we told her that she must have read the mods before asking the creditors for a variation in terms she said that yes she should have and went on to say how many other cases she has to deal with. pity we couldnt have got that in writing!
She is now refusing to have a creditors meeting just for myself so i can offer full and final settlement on my part of the iva saying because of the modifications in my iva she cannot call a meeting she can only file for bankcruptcy.
So i'm either going bankcrupt or i'm going to keep fighting my case. It just becomes very draining sometimes i think it would be better to be bankcrupt just to get it all over and done with.
It seems that your IP is wrong on a number of counts but the most important thing is to first take immediate advice from someone like CCCS.
Unless you have a PVA (Partnership Voluntary Arrangement) you should have two IVAs. One for you and one for your husband. That is why they are called 'individual' voluntary arrangements. It is possible that the terms are different on each IVA.
However, it sounds as though your IP was not going to put Accuma to the expense of petitioning for your bankruptcy until you pressed them - but I would not risk that. Take urgent legal advice.
If your IP is not acting according to the terms of your IVA, the Insolvency Act or the Insolvency Rules then the courts can intervene but you need a solicitor experienced in insolvency matters to look into the details. Who knows, you may even have a claim against your IP for professional negligence.
It may also be that your IP has invalidated the IVA by her actions - in which case it is also just possible that you can recover all of the money paid to Accuma - even if it has to go ( where it was originally intended to go) for the benefit of your creditors.
Also remember that if you do not have significant assets or earnings that bankruptcy is over in twelve months. Look into the implications now. You may find that, in your case, bankruptcy is the best way out. Take advice on this.
In many cases large IVA factories have mis-sold IVAs when bankruptcy was the right option from the outset. It is possible to sue for bad advice. A solicitor should be able to advise you on this.
You may also have grounds for opposing any petition for your bankruptcy. All bankruptcies are at the court's discretion, bankruptcy petitions do not succeed as of right. You might also want to find out of you have any grounds for opposing a petition filed by your IP. Again, a solicitor should be able to advise you on this.
Take advantage of any 'free consultations' offered by local solicitors. Your nearest Citizens Advice Bureau should be able help out on this and point you in the right direction. Many CABs also have 'surgeries' run by local IPs who can advise you.
All of which adds up to my original advice i.e. take as much professional advice as you possibly can; keep all paperwork and also keep a diary or log of all telephone calls to support your case. Make and keep notes of everything relevant.
That's about the limit of the help that I can offer but I would stress that the important thing is to act now. Don't let it drift. Pick up the phone today.
Best of luck.
Thanks to the last post. I will take your advice and call in some legal advice. I hope we can avoid bankruptcy as it seems very a daunting prospect, however I do think it maybe our best option under the circumstances.
thanks again
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