Bankruptcy

[Mmmmm1]

Hi all.

I have a very large debt for solicitors costs. They already have a judgement against and a default order of costs

the circumstances are

a number of years back i was involved in a serious car accident and made a claim for injury.. As the court case began i became seriously ill ( not related to the accident) the claim became secondary and i did not follow through correctly with the case and so lost it. The other side went for costs amonting to 20000, ( the insurance for no win no fee are not paying)

as i have recovered somewhat i am trying to rectify huge problems my illness caused.... I applied to the courts for a set aside based on my illness which has just been rejected by the judge... The other side are now threatening bankrupcy....

there is a house at risk..it is not mine but is in my name.. I hold it for my mother. Iam also on benefits please help. Thankyou

[Openlaw15]

Re: Bankruptcy

Hi all.

I have a very large debt for solicitors costs. They already have a judgement against and a default order of costs

the circumstances are

a number of years back i was involved in a serious car accident and made a claim for injury.. As the court case began i became seriously ill ( not related to the accident) the claim became secondary and i did not follow through correctly with the case and so lost it. The other side went for costs amonting to 20000, ( the insurance for no win no fee are not paying)

as i have recovered somewhat i am trying to rectify huge problems my illness caused.... I applied to the courts for a set aside based on my illness which has just been rejected by the judge... The other side are now threatening bankrupcy....

there is a house at risk..it is not mine but is in my name.. I hold it for my mother. Iam also on benefits please help. Thankyou

When you say you 'hold it for your mother', what do you mean?

[Mmmmm1]

Re: Bankruptcy

Hi open law... The property was bought by my father 20 years ago..after he passed away it was passed to my mother...due to her age and circumstances she was unable to get a mortgage and was threatened with repossesion...she had no choice but to get my sister to lend her name and status to get a mortgage. ( all of this is documented in solicitors letters at the time)
my sister then got married and wanted to buy her own proerty and as i was living with my mother and worked with good credit, it was passed to me... I have no beneficial interest in the property..basically i hold it on trust for her....we drafted a basic home made DECLARATION OF TRUST at the time stating that i hold the property on trust for her...as we didnt envisage any problems within the family..the declaration was directly copied from HMRC tsem 9520 which states that a bare trust such as this is enough for a a court to show beneficial ownership

[Openlaw15]

Re: Bankruptcy

Hi open law... The property was bought by my father 20 years ago..after he passed away it was passed to my mother...due to her age and circumstances she was unable to get a mortgage and was threatened with repossesion...she had no choice but to get my sister to lend her name and status to get a mortgage. ( all of this is documented in solicitors letters at the time)
my sister then got married and wanted to buy her own proerty and as i was living with my mother and worked with good credit, it was passed to me... I have no beneficial interest in the property..basically i hold it on trust for her....we drafted a basic home made DECLARATION OF TRUST at the time stating that i hold the property on trust for her...as we didnt envisage any problems within the family..the declaration was directly copied from HMRC tsem 9520 which states that a bare trust such as this is enough for a a court to show beneficial ownership

When you say the property has been passed to you, do you mean the property was gifted to you?

That's what i wanted to know but did not want to put words in your mouth. If the property is held on trust, any creditors or the official receiver (if you were made bankrupt) cannot come after you for property/ assets you hold on trust for another: Trustee Act 1925. They can come after you for property that belongs to you. So, this is why I ask is the property yours, ie do you have ownership (title)? So, as long as the trust has been dealt with properly, ie the formalities, the trust is safe from creditors and the official receiver. The terms 'declaration of trust' or 'hold on trust' are sufficient for declaring a trust. I am not too certain about whether you have dealt with the formalities for a trust.

A mortgage does not mean ownership it means the bank has security if the mortgage is not paid. So, your mother can still be the owner of the property even if the mortgage is not in her name. If the property belongs to your mother, the creditor cannot come after you for the your mother's property.

[Mmmmm1]

Re: Bankruptcy

I am not sure to. There were no formalities apart from the declaration off trust copied from the hmrc website. The hmrc website also states that no other formalities are required to show beneficial interest....www.hmrc.co.uk/manuals/tsemmanual/tsem9520.htm

also when the property was transfered to my name from my sister it was transfered at undervalue to take into account the deposit..so i have not paid the deposit, i have never paid the mortgage or really have anything to do with it apart from lending my name and status for the mortgage

[Openlaw15]

Re: Bankruptcy

Hi open law... The property was bought by my father 20 years ago..after he passed away it was passed to my mother...due to her age and circumstances she was unable to get a mortgage and was threatened with repossesion...she had no choice but to get my sister to lend her name and status to get a mortgage. ( all of this is documented in solicitors letters at the time)
my sister then got married and wanted to buy her own proerty and as i was living with my mother and worked with good credit, it was passed to me... I have no beneficial interest in the property..basically i hold it on trust for her....we drafted a basic home made DECLARATION OF TRUST at the time stating that i hold the property on trust for her...as we didnt envisage any problems within the family..the declaration was directly copied from HMRC tsem 9520 which states that a bare trust such as this is enough for a a court to show beneficial ownership

Please provide me with all the details of what you have done to make a trust. Show me etc what you have done..by documents, signatures etc.

[Mmmmm1]

Re: Bankruptcy

The declaration was copied directly from hmrc website and states

DECLARATION OF TRUST.. I @@ HOLD THE PROPERTY KNOWN AS ( full address) for my mother @@@@@ absolutley. She has paid the full deposit for the mortgage which is not a loan or gift to me.

signed by me and my other and other family members


the hmrc website states no witness signatures are necessary and it does not need be delivered as a deed
It also states a trust must have 3 certanties for it to be valid
1) words ( intention to create a trust)
2)subject( the property and beneficial interest interest)
3) object ( the person having the beneficial interest)

i believe mine has all 3


i also have solicitors letters at the time of fathers death to show mother has full beneficial ownership and how solicitors were unable to register the property in mothers name. Also have solicitors letter indicating the sale at undervalue. And also the mortgage payments does not go from my account..solicitors will also confirm that they only dealt with my sister. And i only just signed the papers meaning i have really had nothing to do with the propertty. .. I believe all this could amount to something called a constructive trust???

[Mmmmm1]

Re: Bankruptcy

The declaration was copied directly from hmrc website and states

DECLARATION OF TRUST.. I @@ HOLD THE PROPERTY KNOWN AS ( full address) for my mother @@@@@ absolutley. She has paid the full deposit for the mortgage which is not a loan or gift to me.

signed by me and my other and other family members


the hmrc website states no witness signatures are necessary and it does not need be delivered as a deed

i also have solicitors letters at the time of fathers death to show how solicitors were unable to register the property in mothers name so had to be registered in sisters name.. Also have solicitors letter indicating the sale at undervalue. And also the mortgage payments does not go from my account..solicitors will also confirm that they only dealt with my sister. And i only just signed the papers meaning i have really had nothing to do with the propertty. .. I believe all this could amount to something called a constructive trust???

[Openlaw15]

Re: Bankruptcy

The declaration was copied directly from hmrc website and states

DECLARATION OF TRUST.. I @@ HOLD THE PROPERTY KNOWN AS ( full address) for my mother @@@@@ absolutley. She has paid the full deposit for the mortgage which is not a loan or gift to me.

signed by me and my other and other family members


the hmrc website states no witness signatures are necessary and it does not need be delivered as a deed
It also states a trust must have 3 certanties for it to be valid
1) words ( intention to create a trust)
2)subject( the property and beneficial interest interest)
3) object ( the person having the beneficial interest)

i believe mine has all 3


i also have solicitors letters at the time of fathers death to show mother has full beneficial ownership and how solicitors were unable to register the property in mothers name. Also have solicitors letter indicating the sale at undervalue. And also the mortgage payments does not go from my account..solicitors will also confirm that they only dealt with my sister. And i only just signed the papers meaning i have really had nothing to do with the propertty. .. I believe all this could amount to something called a constructive trust???

Whose name is on the property's deeds currently? No, your trust is an express trust....constructive trust means it's an implied one. Can you show me what letters you have, and refer me to HRMC website (as that link you provided doesn't work). A trust must normally be fully constituted, ie a document passing ownership to the trustee, and any formalities dealt with, ie in writing, signed. Yes, please show me what solicitor's letters you have that refers to any type of beneficial ownership. How much was the sale for, when, and purchased by whom? Who pays the mortgage if it doesn't go from your account? What interest does your sister have in the property?

[Mmmmm1]

Re: Bankruptcy

Hi open law. I understand its an express trust, but the situation surrounding the propertty could possibly be implied trust.?

hmrc, Www.hmrc.gov.uk/manuals/tsemmanual/tsem9520.htm

also i do not know how i can show the documents. Im not good with computers

the property is registered in my name at the moment

the time line is a s follows:

1) father buys property about 20 years ago
2) father dies about 15 years ago and property passes to mother by probate
3) solicitors are unable to register the property in mums name due to her age and circumstances so was unable to secure a mortgage
4) fathers mortgage company threatens to reposses
5) sister lends her name for the purposes of a mortgage and holds the property on trust for my mother
6) sister gets married and wants to buy her own property and doesnt want the complications of cgt
7) in 2008 i lend my name for the mortgage and hold it on trust for mother purchase price of 125,000 ( now valued at 119000) less sale at undervalue of 45000.

the mortgage goes from my sisters account as she deals with everything to with the house for my mother

[Openlaw15]

Re: Bankruptcy

Hi open law. I understand its an express trust, but the situation surrounding the propertty could possibly be implied trust.?

hmrc, Www.hmrc.gov.uk/manuals/tsemmanual/tsem9520.htm

also i do not know how i can show the documents. Im not good with computers

the property is registered in my name at the moment

the time line is a s follows:

1) father buys property about 20 years ago
2) father dies about 15 years ago and property passes to mother by probate
3) solicitors are unable to register the property in mums name due to her age and circumstances so was unable to secure a mortgage
4) fathers mortgage company threatens to reposses
5) sister lends her name for the purposes of a mortgage and holds the property on trust for my mother
6) sister gets married and wants to buy her own property and doesnt want the complications of cgt
7) in 2008 i lend my name for the mortgage and hold it on trust for mother purchase price of 125,000 ( now valued at 119000) less sale at undervalue of 45000.

the mortgage goes from my sisters account as she deals with everything to with the house for my mother

what circumstances couldn't you mother receive the gift of property? Are you saying she cannot manage her own affairs owing to being too sick? As the trust affects land, ie a home it requires transfer by owner (your mother/ other) by deed to you. What do you mean you lend your name for the mortgage? So, your sister pays for the mortgage? Is your sister power of attorney for your mother? Who purchased property for £45,000 and why? Why wasn't full price paid?

[Mmmmm1]

Re: Bankruptcy

The property wasnt a gift to mother,.. After father passed away the property is passed to mother by probate but as it was a mortgaged property, she either needed to pay off the remaining mortgage in cash or secure her own mortgage to be able to keep the property She couldnt do either.
And so she asked her children to secure a mortgage and hold the property for her.

The property is rented out and my sister deals with the rental on behalf of my mother

nobody purchased for 45000
Sister held property first and then was transfered to me... But was transfered at undervalue so i didnt have to pay a deposit for mortgage. My purchase price was 125000 Minus the 45000 gifted deposit so my mortgage amount is 80000

[Openlaw15]

Re: Bankruptcy

The property wasnt a gift to mother,.. After father passed away the property is passed to mother by probate but as it was a mortgaged property, she either needed to pay off the remaining mortgage in cash or secure her own mortgage to be able to keep the property She couldnt do either.
And so she asked her children to secure a mortgage and hold the property for her.

The property is rented out and my sister deals with the rental on behalf of my mother

nobody purchased for 45000
Sister held property first and then was transfered to me... But was transfered at undervalue so i didnt have to pay a deposit for mortgage. My purchase price was 125000 Minus the 45000 gifted deposit so my mortgage amount is 80000

Ok thanks for that, leaving the rent situation to the side a trust involving a property must be done via a deed of transfer. If this is not complied with the trust i believe is not yet finalised in law.

[Mmmmm1]

Re: Bankruptcy

Thanks open law
but i think we have misunderstood each other....it is not a transfer. Just a trust
i am a trustee who holds the property for my mother who has full beneficial ownership and i have declared as such

did you read the hmrc link?

[Openlaw15]

Re: Bankruptcy

Thanks open law
but i think we have misunderstood each other....it is not a transfer. Just a trust
i am a trustee who holds the property for my mother who has full beneficial ownership and i have declared as such

did you read the hmrc link?

You cannot pass land, ie property through a trust with it being done by a deed. The technical term is constituted, where the owner passes title of land through a trust for the benefit of another. HMRC is not the law, the law of trusts is the law. You have to prove you have a trust before you benefit from a trust otherwise the receiver in bankruptcy may be able to claim the beneficial interest. For trusts affecting land it requires constituting and formalities. Every passing of land normally has to be done via a deed. Declaring a trust when it relates to land is no different, it's there to avoid fraud.