Bankruptcy Advice

For someone who has never dealt with a trustee...what does a good one look like?

Right about the website! I've emailed her/him? and nothing yet. Hopefully tomorrow.

 

I don't really know about what trustees can legally advise on but you would expect they could advise on the bankruptcy act. There may be specific legislation that enables them to give legal advice on this area. Not sure

 

I am on a email newsletter list for the insolvency experts and they seem pretty good. They also have a 24 hour hotline I think.

 

Thanks Terryw! Do you have any thoughts on the new Insolvency Law Reform Act? Sounds like a hail mary but maybe i can dig deep long enough for the proposed change to 12 months

 

The Insolvency Experts is a business name, run by a trustee called Steven Kugel. He offers the same service as all others.

I would highly recommend Brad Tonks from PKF. He’s in Sydney but your trustee doesn’t need to be in the same city. Brad is extremely good and efficient.

 

Most reliable source is word of mouth from someone who has seen the way they work. It’s impossible to tell from their website.

 

Jeepers for something so costly(10K average) word of mouth seems like a fairly big throw of the dice.

No one seems to be discouraging the thought of filing it yourself. Especially in a relatively simple case. What does 10K even buy you in a trustee? Im assuming 3-5 years(8 if naughty) of management fees.

 

Options. I had a mate who was sure he would have to file for bankrupcy after his business failed. He got in touch with a good bankruptcy lawyer, worked through his options and decided not to file. He did have to sell his house though.

 

Options are fairly simple. The free service provides these options. I don’t really see the point of forking out a small fortune to get what you can get for free from a whole heap of government and charity organisations.

Check this out Seek legal assistance for debt related issues | Australian Financial Security Authority

 

Very case dependent but indeed very helpful in the case of your friend. Imagine filing only to find out later there was a much better 'option' ...ouch!

 

Hi mate. For my case only...neither do i!
However i can certainly see the value of a private trustee. They have to operate in the interests of creditors, although....and i could be wrong here...you get to specify who "hangs" you so to speak.

Whilst the trustee operates at arms length you can build somewhat of a rapport pre and post bankruptcy. In a 'better the devil you know' kind of way. That has potential value. Ive heard of some pretty heartless trustee stories.

 

Depends how bad things are. If its catastrophic it wont matter if you take a court appointed trustee. That's an important part of what personal legal advice would address. The role of a trustee is not to punish. Its to fulfil the lawful requirements of discharging debts to the extent the laws require using the assets and income as stipulated by law. What cant be discharged is then not payable and the slate becomes clean. Reputational harm can follow

Legal advice will also address risks to the bankrupt such as what occurs if a death inheritance occurs during bankruptcy. They may suggest parents and spouses etc change their wills. They may also recommend other strategies to protect some assets.

Its like liquidation for a company. Engaging an administrator / liquidator may or may not be a benefit and in some cases the creditors will vote and appoint their nominated replacement. And whether you can pay one who is friendly. No money ? Forget it. That can be an important issue if a liquidator proposes to sell business assets, IP and other property.

 

Another way to think of it, if you have $10k cash sitting around you are going to lose it anyway....

 

What if this $10K is in Bahamas under the Mums name ?

 

then it is not his and not available to creditors - at first glance.

 

Yes as mentioned on the AFSA website however define "punish". A degree of leniency could fit the bill depending on which side of the scale you sit. I've since been told of two instances where one trustee had a very strict interpretation of the travel rules(hand in passport with a gestapo like interrogation) and another not so much(simple notify of travel with req details)

Trustees do have some discretion which can work for or against the bankruptee.

Indeed. I don't have $100 to squirrel away atm but i'm pretty sure the powers that be would find it i did! My understanding is they the power scour all records including potential persons of interest(partner who has been gifted $$)

 

Giving money or other assets comes down to what i imagine is an applicable time period. 10K to mum 2 years ago? Maybe not but 6-12months? ....highly likely, again depending on the trustees or AFSA interpretation of that transaction.

Conviction of fraud would, i asumme, be dependent on what the allowable transfer period is. I swear i saw something about chasing a transfer that went approx 3 years back from the initial filing.

 

s37A Conveyancing Act nsw (and WA equivalent) can allow clawback of any transfer to defeat creditors
also s 120 and s121 bankurptcy act has a 4-5 year period for related party transfers under market value or unlimited potentially if trying to defeat creditors

 

It would be interesting to see what constitutes "trying". If a person suddenly falls ill and is made bankrupt due to increasing debt(e.g mortgage repayments) but made a transfer of 10k to a partner only months prior, would they be considered a fraudster?

 

That transfer would be clawed back.