strongly agree. 12 months late, threat/possibility of bankruptcy, there is property offered as security, tight timeline and the lawyers solution was to send a debt collector and then takes weeks to send a letter of demand?? the lawyer is either not up to the task or doesn't care. Either way a new one is needed.
if he reneged on a previous deal was he bankrupted? did your lawyer advise you of this prior to you entering into the agreement?
Its not illegal to transfer properties prior to bankruptcy. But if a property has been transferred so as to try to defeat creditors then it could be clawed back for an indefinite period. If the transfer has been done to a related party and it was not intended to defeat creditors it can still be clawed back if it was an undermarket value transfer and less than 5 years prior to the bankruptcy
I did this with getting a debt paid, my brother and some of his mates with funny emblems(when they could display them) on their backs with noisy motorbikes randomly pop around.Works a treat.
Can I just ask why you haven't lodged a claim through your Magistrates court? You have grounds for a legal judgment against this person, and possibly for the entire contract amount by extension. If you get this judgment, then order a Seizure and Sale order through the Bailiff. They will seize any property in the entity / name / extension of such; then auction it. I'm not sure on the total amount owed, but it may even get to the point of not even needing a lawyer - the Magistrates Court is designed to be a quick and efficient method of settling disputes. It's been that way for me, anyway. But most of my claims are <20k and for the love of god don't take my experiences as gospel for your situation.
A few things. The 12 months was my choice. The purchaser asked for leniency until things got better. It was foolish in retrospect, but I agreed. The other vendor finance agreement went bad only about a year after mine was negotiated. At the time of the sale it was still going well. He had bought another business which was going well at the time- but the lease wasn't renewed, and having paid a lot of money for the business he had to close up shop. I don't believe it was, or is, his intention to do the same with my agreement, as in that case, he transferred ownership of the purchasing entity and closed it down. He is still listed as owner in the entity which bought my business. The default was uncovered as a result of my initiating action, and I have been able to contact the aggrieved party. Apparently there are guidelines about trying to reclaim the debt. The procedure involves serving notices successively, giving him a chance to pay back before things get tough. My understanding is that this procedure is the same regardless of whether it's a lawyer or debt collector. The process has been initiated.
I am no litigation lawyer, but no notice is necessary. You are owed money so you could lodge a statement of claim immediately with the court. This would then be served on him and he would have about 28 days to either pay up, come to an arrangement or file a defence (arguing he doesn't owe you as claimed). If he doesn't turn up you can ask for a judgement and will get it usually. once you have a judgment you can wind up the company or get the sheriff to seize property. The reason that a letter of demand is sent out is to boost your argument that you gave him reasonable notice. This may help you with some arguments if the matter drags on, but is not legally required.
Sounds to me like it's 200- odd bucks down at the Magistrates Court to lodge a claim and get legal action ASAP. If you get a judgment I'm pretty sure you become a primary creditor...? Happy to be corrected there though.
I've not been happy with EC Credit Control. It took them two weeks even to initiate proceedings- and even then I was pushing them. During proceedings I sent them an email indicating that I had understood that bankruptcy proceedings were going to be initiated against the person who owed me the money. EC forwarded my email through to the debtor! His response was that he wasn't aware of this, and will initiate a defensive position. Now the 28 days after serving the initial notice have passed, and it's been passed to the legal team which they use- my lawyer has little litigation experience and doesn't want to take up the matter. EC gave me details of their recommended legal team. Except that they gave me the phone number and contact details of the Sydney branch of the firm- they are based in Melbourne. And they incorrectly spelt the lawyer's surname and therefore the email address.
sorry to hear it isnt going well. you're under no obligation whatsoever to answer me but is there any reason you have been so hesitant to get proper advice from the start or even from when you started this thread? a lawyer specialising in debt recovery would be able to not only act on your behalf to chase your money down but explain to you where you stand and what the best tactic/steps to take are. as you have seen if you hire monkeys they're going to make a mess of it and from your earlier post it's a pretty large sum of money, the cheapest/easiest option is often the most expensive when the margin for error is as narrow as it sounds like it is in your situation with regards to recovering the money. it's still not too late to sit down with someone who knows what they're doing to get a clear picture of best steps, what has been done correctly or wrongly, what could be done to protect you further, what to avoid doing so you don't weaken your position etc. eg it has been 2 months since this thread started, you effectively are worse off than before because chances are the available pie of the other party's assets is getting smaller and smaller.
I'm so sorry to hear it's been such a mess geoffw. I can't offer any advice, but I really hope things improve for you.
few questions, @geoffw you sold it on a vendor finance agreement, i would have thought you would have at least got your price? meaning wouldn't it allow you in your contract to take back the property/business if he defaults on the loan meaning you wouldn't loose that much money, also bit confused here but with resi property you wouldn't normally transfer the title until the last payment is made. have you transferred company to him from day 1? @Terry_w with his scenario can't you ask when selling the business to lodge a 2nd mortgage on properties that he owns? for security? instead of a personal guarantee even if those properties are resi and have nothing to do with the business? Cheers, Elives
I talked to my lawyer from the start. He advised me to go the debt collection route. It was only last week that I found out that he's not experienced in litigation, which may be why he recommended that course of action. The lawyer recommended by the debt collectors is well versed in debt collection, but I'm yet to see how he will go. The initial talk was very good, subsequent follow up has not been.
Elives Vendor finance is just a personal loan in effect. The buyer gets title straight away, I'm lending him the money to pay me. The price initially was rather much higher than I would have received for a straight purchase, but the money I've received so far is rather much lower. If I could collect nothing, I would be very much behind. And I do have security on his property, such as it is- it's not just personal guarantee as I mentioned at the start of the thread. I have security on two businesses plus personal property. He does rent however.
would this be a normal business special condition? in the above scenario or would this be a bad idea? (odds of it happening being low)
