See How Our Team Helps You With Voluntary Bankruptcy
An Example of Voluntary Bankruptcy When We Paid a Dividend to Creditors at 30.20c/$
Background
Our clients, a husband and wife, operated a small family business installing sheds under a franchise agreement. The franchisor sold the business to a new party. After the new franchisor took over management, it was determined that our clients’ business was insolvent and the agreement was terminated. Our clients ceased trading. They had no other source of income and, consequently, failed to make their mortgage repayments on their family home. As a result, the secured lender repossessed and sold the house at a loss of $40,000. As our clients had other creditors and no ability to pay their debts (which totalled around $351,000), they both declared bankruptcy.
How We Helped
As our clients had separate and joint assets and debts, we treated them separately in each estate – hers, his, and the joint estate.
During the bankruptcy period, we conducted a review of the clients’ examinable affairs (as required under the Bankruptcy Act 1966), reviewed assets owned prior to and during the bankruptcy, dealt with the creditors, provided updates to both creditors and our clients regarding the progress of the bankruptcy, and assessed and collected income contributions which were required from the husband due to him earning income above the threshold.
End Result
- The clients were discharged from their bankruptcy 3 years and one day after their debtor's petition was accepted.
- We paid a dividend to creditors in the husband's separate estate at 30.20 cents in the dollar.
- The clients were released from their remaining debts.
- Their bankruptcy was finalised, and the clients were able to move on and start a new chapter in their lives.
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