Can they make me bankrupt?

[arneldlayne]

First of all apologies if this is the wrong forum, but reading through it there does seem a wealth of experience so someone may be able to help.

Last year through a very complex set of circumstances and some id fraud, my wife was made bankrupt. I was not involved in anyway and have not been named in any of the proceedings. During the whole thing. My wife had legal representation throughout this sorry affair, and the fees were part funded by someone else involved in the case (in fact a now former friend who conned her and had played a significant part in the dealings leading to the bankruptcy). During this time I acted as no more than a supportive partner and although I did talk to the solicitor I did so because my wife was too traumatized to do so. There were 3 hearings of which I attended 2 and her sister also attended.

After the bankruptcy my wife declared the solicitor to the OR as a creditor. Her case is now with an insolvency practitioner but the information and creditors list remains the same.

Well, now the solicitor is coming after me for the princely sum of £13k for the outstanding fees. There has never been any written agreement between me and them to cover any fees, and in fact although I did receive emails from him, they were very much as an intermediary for my wife. They have now said unless I pay the full amount by June 24th they will issue BANKRUPTCY proceedings against me!!!

My gut feeling is they have no case....I could pay the amount by selling all my shares, putting my bonus in and some money due from an accident compensation claim, so the money is there....but my argument is that it's not my debt. They were representing my wife and not me (as I said I was not involved in any way) and she has declared them as a creditor.....can they chase me, a 3rd party for a declared debt on my wife's insolvency? Can they declare the debt to be mine without any written agreement from me? I have had no client care or retainer letter and they have certainly never had anything from me in writing accepting responsibility. The actual solicitor seems to have construed my involvement as a verbal agreement to cover the costs. It's also worth noting that the solicitors acting for the company that petitioned my wife has stated that in their opinion my wife never stood a chance of winning the case from the outset and that she had been given false hope by allowing them to represent her.

I have yet to reply to them but have talked to the CAB (they made the point about the 3rd party being chased for a declared debt and that the solicitors should only be dealing with the insolvency practitioners). I'm also seeking advice from our employee assistance scheme. My worry is that if I need legal representation then it will cost me a huge amount of money and anyway, how likely would it be for a solicitor to represent me against another firm of solicitors over a disputed fee? I don't wish to be rude but it seems quite an incestuous industry and after seeing my wife's experience from last year I'm not sure I trust them to do the right thing by me anyway.

If this goes ahead then I'm worried that I'll lose everything on the basis of a debt I did not agree to be liable for.

Anyone have any advice or comments?

*Note for mods...if this is the wrong forum please feel free to move it*

[TUTTSI]

Re: Can they make me bankrupt?

Hi and welcome to Legal Beagles.

I would not of thought that you are responsible for your wifes debts unless you signed their letter of engagement. Also, as you stated that your wife has now added them to the OR as a debt in her name only.

Is there any correspondence where your wife may have stated that you would indeed pay in the event that she was bankrupted?

It may be a good idea to write back and refer them with this invoice to the OR as you have not agreed to cover your wife's legal costs. Keep everything in writing and you could also put a cc on the letter to the OR and send them a copy of your letter to the solicitors.

They may just be pulling a fast one in the hope that you will just pay it.

Please let us know how you get on.

Tuttsi

[arneldlayne]

Re: Can they make me bankrupt?

Hi and welcome to Legal Beagles.

I would not of thought that you are responsible for your wifes debts unless you signed their letter of engagement. Also, as you stated that your wife has now added them to the OR as a debt in her name only.

Is there any correspondence where your wife may have stated that you would indeed pay in the event that she was bankrupted?

It may be a good idea to write back and refer them with this invoice to the OR as you have not agreed to cover your wife's legal costs. Keep everything in writing and you could also put a cc on the letter to the OR and send them a copy of your letter to the solicitors.

They may just be pulling a fast one in the hope that you will just pay it.

Please let us know how you get on.

Tuttsi

Hi, so far I've written a letter to them formally disputing the debt, plus enclosed a Subject Access Request under the DP 1998 Act. I've asked them for copies of any contracts and transcripts of phone calls whereby they can prove a verbal contract. I have never signed anything. I'm off to the court now to put the forms in to set aside the claim. It's worth noting that one of my contentions is the delivery of the SD by email!!!

Any other advice or experiences of similar will be much appreciated. I'll keep yopu up to date.

Another great internet commiunity byt he way

[TUTTSI]

Re: Can they make me bankrupt?

Good luck, you seem to have a grasp of the situation and have done everything correctly.

Have they actually issued a stat demand? or court proceedings?

Don't forget to report this to the OR and advise them what is going on.

Tuttsi

Hi, so far I've written a letter to them formally disputing the debt, plus enclosed a Subject Access Request under the DP 1998 Act. I've asked them for copies of any contracts and transcripts of phone calls whereby they can prove a verbal contract. I have never signed anything. I'm off to the court now to put the forms in to set aside the claim. It's worth noting that one of my contentions is the delivery of the SD by email!!!

Any other advice or experiences of similar will be much appreciated. I'll keep yopu up to date.

Another great internet commiunity byt he way

[arneldlayne]

Re: Can they make me bankrupt?

Good luck, you seem to have a grasp of the situation and have done everything correctly.

Have they actually issued a stat demand? or court proceedings?

Don't forget to report this to the OR and advise them what is going on.

Tuttsi

Its a Statutory Demand. My wife has spoken to her IP and they have confirmed the debt as being lodged with them for their administration.

[TUTTSI]

Re: Can they make me bankrupt?

I cannot imagine what you are going through right now it must be a total nightmare.

It seems strange that a law firm would let anyone roll up a debt especially when they knew it was a bankruptcy case. So I would have envisaged that they would have had to have had an agreement either verbally or otherwise for their fees to be covered to substantiate the extortionate fees they have charged.

Normally, solicitors ask for payments upfront and they would normally charge further amounts on account when funds start to deplete and they would not in my experience ever rack up such high fees without some form of guarantee. So something does not smell right here.

Has your wife got the agreement she signed with them, have you looked over this along with all the correspondence?

Tuttsi

[Amy]

Re: Can they make me bankrupt?

How was this statutory demand served?

Have a read of this thread and in particular, of post #7 Threat - Legal Beagles Consumer Forum

Personally, I think they have screwed up since there is nothing in writing to say that this is your debt and unless you both signed to make it a joint agreement then you are not jointly and severally liable for it.

Are you absolutely certain they cannot prove this as your debt?

[arneldlayne]

Re: Can they make me bankrupt?

I cannot imagine what you are going through right now it must be a total nightmare.

It seems strange that a law firm would let anyone roll up a debt especially when they knew it was a bankruptcy case. So I would have envisaged that they would have had to have had an agreement either verbally or otherwise for their fees to be covered to substantiate the extortionate fees they have charged.

Normally, solicitors ask for payments upfront and they would normally charge further amounts on account when funds start to deplete and they would not in my experience ever rack up such high fees without some form of guarantee. So something does not smell right here.

Has your wife got the agreement she signed with them, have you looked over this along with all the correspondence?

Tuttsi

Every bit of paperwork and correspondence was handed to the OR, and then the subsequent IP. At no pint did I sign anything - or even receive any letters, bar a few emails which were sent to me. They are claiming a verbal agreement but again I doid not agree to this - why would I and especially knowing the level of the fees. Like I say, I've never signed anything, and I can only think they are perceiving the fact that I did act as an intermediary as implicit acceptance for fees. The truth is I am probably able to pay the money but that would involve selling every last share I own (its my only savings machine, BOGOF scheme) and my annual bonus, plus my compensation money from a bad road accident two years ago, but my view is why the hell should I see everything I've worked for be taken away to pay a debt on fees they accrued representing my wife? I'm not named in her bankruptcy (its very complex and involves her being the subject of ID fraud) and yet they seem hell bent on runing my life.

I take the view that I came very close to leaving her after this due to the intolerable strain it put on our relationship but I stuck it through (it seems to easy to walk away from marriage in my view) and we're slowly repairing things and then along comes this. But what would they have done if I'd walked away, moved away, started again? If they make me bankrupt, we're homeless as I am claiming her half of the estate - our house is break even at best, plus my hard earned pension can be affected, the mobile home I own in France (bought with my own savings from shares 5 years ago). It seems very unfair and designed to ruin me with no view of what it would do to me job wise, the devastating affect it would have on the family. It feels like legalised theft. What would be the point of carrying on working? Every year we go through redundancy fears...but even that money might be taken if I'm bankrupted on a debt i have NEVER signed up for. If they're claiming verbal contract then that seems even more unfair as most ordinary people would never understand the implications that might arise from another persons translation of a conversation or dialogue.

Some of the initial fees were paid, but again these were by someone else and not from my bank account. Frankly I take the view that they took the risk and they lost out. I would also state that I never engaged the solicitors in the first place. One interesting side note is that the IP and the solicitor representing the chief creditor behind my wife's bankruptcy commented on the level of the fees, and also said that she'd never had a single chance of winning and that in their view the solicitor had misrepresented any chances of success by 100%!! I believe that may be part of the recorded transcript of the only meeting with her IP thus far.

Ultimately it looks like it will be my word against theirs and such is the distrust I have in the legal profession I can only see a judge agreeing with them.
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How was this statutory demand served?

Have a read of this thread and in particular, of post #7 Threat - Legal Beagles Consumer Forum

Personally, I think they have screwed up since there is nothing in writing to say that this is your debt and unless you both signed to make it a joint agreement then you are not jointly and severally liable for it.

Are you absolutely certain they cannot prove this as your debt?

Hi Amy - I am certain nothing was ever signed by me as a personal guarantee of any fees. The SD was served as an attachment to an email. Which is one of the grounds of contention for the set aside.

[Amy]

Re: Can they make me bankrupt?

The SD was served as an attachment to an email. Which is one of the grounds of contention for the set aside.

Really! I cannot imagine for one second that issuing a stat. demand via email could ever be deemed served.

I think they are just trying to scare you.

[arneldlayne]

Re: Can they make me bankrupt?

Really! I cannot imagine for one second that issuing a stat. demand via email could ever be deemed served.

I think they are just trying to scare you.

Hi Amy - yes, everyone I've spoken to from National Debtline, Consumer Direct, CAB and the Community legal Service has said similar. Even the person at court today who accepted the 'set aside' claims was surprised. Hopefully that alone will be enough to get it set aside, but like I say my mistrust of the legal profession is running quite high at the moment but a lot of that is based on some of the horro judges my wife encountered last year, who bordered on the downright rude and personal.

[TUTTSI]

Re: Can they make me bankrupt?

Normally if they send it by email they should also send it by post. So, is this a valid stat demand, I don't think so. But the threat is there and they should know better as a law firm.

You are definately right to make the application to set the stat demand aside as this was not only not served correctly there is no basis for the claim in the first place.

What correspondence did you have from these so called solicitors before they issued a stat demand by email? how and did they know your email address? did you comunicate with them at any time?

Tuttsi

ps in case we need this a latter date the Solicitor Complaints Bureau http://www.google.co.uk/url?sa=t&sou...gEGL8LD_6uBe0Q

[arneldlayne]

Re: Can they make me bankrupt?

Normally if they send it by email they should also send it by post. So, is this a valid stat demand, I don't think so. But the threat is there and they should know better as a law firm.

You are definately right to make the application to set the stat demand aside as this was not only not served correctly there is no basis for the claim in the first place.

What correspondence did you have from these so called solicitors before they issued a stat demand by email? how and did they know your email address? did you comunicate with them at any time?

Tuttsi

ps in case we need this a latter date the Solicitor Complaints Bureau http://www.google.co.uk/url?sa=t&sou...gEGL8LD_6uBe0Q

I gave them my email address when I was acting as the intermediary, and yes I have conversed with them at my wife's request. Basically she couldn't talk about it because she was so distressed at the time. However she clearly engaged their services, in fact the invoices are all in her name. As I said this is probably going to be my word against theirs and they are claiming a verbal contract. Like I said, there's no way I would have done that, I simply wouldnt have committed myself to that level of debt when I haven't got that cash (not spare anyway) .

[WendyB]

Re: Can they make me bankrupt?

Just a point, do you have household insurance? it may be worth checking your policy, as some policies include legal advice?

[righty]

Re: Can they make me bankrupt?

It seems to me that this firm is attempting to circumvent the IP in the hope of being treat as a preferential creditor ........... very naughty

As for their claim unless you signed a client care letter/letter of instruction then they are stuffed

As for the SD being served via email being legit that's for a court to decide. Whatever you do you cannot ignore it you have 18 days in which to lodge an application to have it struck out & to seek costs against them I also suggest you also ask (although I doubt you'll get them) for exemplary costs just to teach them a lesson
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Almost forgot report them to the SRA NOW Show them your not to be messed with

[diddydicky]

Re: Can they make me bankrupt?

Normally if they send it by email they should also send it by post. So, is this a valid stat demand, I don't think so. But the threat is there and they should know better as a law firm.

You are definately right to make the application to set the stat demand aside as this was not only not served correctly there is no basis for the claim in the first place.

What correspondence did you have from these so called solicitors before they issued a stat demand by email? how and did they know your email address? did you comunicate with them at any time?

Tuttsi

ps in case we need this a latter date the Solicitor Complaints Bureau http://www.google.co.uk/url?sa=t&sou...gEGL8LD_6uBe0Q

even sent by (ordinary) post would not fulfil the requirements of service
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It seems to me that this firm is attempting to circumvent the IP in the hope of being treat as a preferential creditor ........... very naughty

As for their claim unless you signed a client care letter/letter of instruction then they are stuffed

As for the SD being served via email being legit that's for a court to decide. Whatever you do you cannot ignore it you have 18 days in which to lodge an application to have it struck out & to seek costs against them I also suggest you also ask (although I doubt you'll get them) for exemplary costs just to teach them a lesson
------------------------------- merged -------------------------------
Almost forgot report them to the SRA NOW Show them your not to be messed with

a letter delivered by normal post cannot be said to have brought the notice to the attention of the recipient (since it might not be the recipient that opened it)

i would imagine the same argument could be made for an e mail- there is no way to prove that the intended recipient of the notice was the one that opened and read the e mail (IMO)

indeed, the e mail may have been caught in a spam filter and not been read in any event

(you can download a programme that allows you to read e mails - and if necessary ignore them - without the sender being able to detect it has been read)