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This is the place to ask questions about Sequestration
#27279
Hi.. I am new here. I really hope somebody could help me.

I entered sequestration 3 years ago. And this February is my final month to pay contribution towards my sequestration, which is £200 per month. And my IP has advised me that I will be released from my sequestration afterwards.

Unfortunately, to my surprise, I just received an email yesterday from my IP saying that they decided to take my car which is worth £1550, or I have to pay the same amount if I want to keep the car.

What make me really confuse here is, at the beginning of my sequestration, I owned BMW which was worth around £2300 at that time. But my IP assured me at that time that they not touching the car as the value is not significant and I needed it to get to work, and as long as I have maintain a £200 contribution per month.

After a year in sequestration, I have decided to sell the BMW with an advise from my IP, as result that I could not maintained the car. And I swapped to more fuel efficient car. I sold BMW for £2000 and with the whole lot of the money I bought Renault. And I have updated everything to my IP. In fact, I never failed to submit my circumstances review form every 6 months to my IP.

I was so confused and shocked by the decision that they make at the final month of my sequestration, while they have 3 whole years to decide about this. Is this sounds right to you? I also wondered why they could be OK with BMW that worth £2300 at the beginning, but not OK with Renault worth £1550 at the end? Please somebody advise me regarding this matter.

Your help and words are very much appreciated. Many thanks in advance.
#27280
Mikey,

Hi and welcome. This sounds very odd, has your IP asked you to find a cheaper car or do they intend to leave you without a car at all? Do you still need a car to get to work?

It sounds to me like they are trying to maximise the return to creditors at the last minute to be honest. Which IP are you with?

Call them and ask them what value of car would they like you to replace your current vehicle with, see what they say.

Rgds
Steve
#27281
Hi Steve,

First and foremost, thank you very much for your reply. Yes, I think I'm in the same boat with you Steve. Its sound very odd. But I'm not the specialist in this area, that's why I need some more opinions regarding this matter.

Sound to me they want to leave me with no car. I have mentioned I need a car to get to work obviously, to send and pick my daughter up from school, etc. They replied that I could use extra money £200 start from March to begin new life(finding new car, etc???). I am so depressed with this matter at the moment. But all I can do is to ask them to review their decision, based on that I have made my best effort to cooperate with them for the last 36 months.

Steve, I will private message you the IP details. Many thanks for your words.
#27301
Hi there Mikey

This sounds highly irregular to me. It is generally accepted that if you live in Scotland and are sequestrated, then you are allowed to keep a car worth up to £3000 as long as you need it. Have a look here for more details: Value of assets in sequestration.

I suggest that as a first port of call you speak to someone at the Accountant in Bankruptcy (AIB). This is the government department which oversees IPs and sequestration rules. They may be able to give you some solid information with which to take back to your IP??
#27303
Hi Hayden,

Thanks for your reply. I just about to update this space. I received a call from my IP today, and they gave me an answer after reviewing their decision since last week.

They decided to ask half the value of my car (£1550), rather than taking the full amount. Hmmm... I obviously not happy with this decision. First, I don't know what the base of their calculation/decision. Secondly, why NOW?

They told me the are interested with my car from the beginning of my sequestration. They just let me used the car to go to work, and don't want to bother me with the car issue at that time. And when the time has come, they just told me they want the value of the car. Could pls someone advise me; IS THIS LEGAL??

My point is, if they really interested with my car from the beginning, shouldn't I've been informed about that? And they DID NOT tell me the options whether I could sell my car and buy the cheaper one, or I could find third party to raise a sum similar to the difference between the value of the car and £1000 ( they said it's £1000, not £3000). Again.. IS THIS LEGAL?? I kind of see it like mishandling case.

They mentioned that my allowance for the car is £1000 as I signed the sequestration 3 years ago. So I have to stick to the old guide, not the new £3000 limit. But they asked £750 from me today, and I don't know how they calculated it.

I have told them that I will speak to AIB regarding this matter, as I am so confuse and not happy with this situation. I will update this space again for any updates. Many thanks again Hayden.
#27313
Hi there Mikey

I am sorry to read about your situation. This certainly seems very underhanded as regards to the actions of your Trustee. There is no question in my mind that if they had wanted to involve your car or any part of it as an asset in your Sequestration then this should have been made clear to you from day one.

Under normal circumstances at the time you were sequestrated a car worth more than £1000 would have been considered by the Trustee (This level changed to £3000 in c2010).

You mentioned that at the beginning of your Sequestration the Trustee assured you that your car would not be taken into account. Have you got this in writing? Given this situation it might be possible to complain to the Accountant in Bankruptcy (AiB) as Hayden has suggested. However I am not sure how helpful they will be.

Ultimately the max you should have to pay for your car now is anything that it is realistically worth over and above £1000 (ie £550 if you believe the value is £1550 but you should double check auto trader or glasses guide to confirm). As such they should never be able to take more than £550 given they have already confirmed that you needed a car and let you keep it at the beginning.

I would be very interested to hear the feedback you receive from the AiB.
#27332
Hi James and all,

I feel so down today as I received a reply from my IP, answering my few questions. To cut the story short, allow me to just copy and paste an email between us.

These are questions from me to them:

1-if my car was not an exempt asset, why I was not being informed about this way much earlier? Nobody said anything, verbally or in writing, when I signed up the sequestration or each time after I have submitted my 6 months review.

2-if the relevant limit was £1000 for the vehicle at the point when I entered sequestration, I believe I am entitle to have £1000 allowance rather than half of the value of my car (£750). Am I correct? And on what basis do you make your first decision that you require all of the fund coming from the value of my car (£1550)? Plus, I would like to emphasise the point that I need a car to get me to work.

3-my previous BMW was valued at £2000+ (referring to your valuation in my sequestration application form), and why you did not advise me to sell that car and buy another car in relevant limit at that time which is £1000? Or maybe advised me to find a third party who can raise a sum similar to the difference between the value of the car and £1000 which is then can be paid to you? It is my right as a debtor to know these options from my IP. And I believe if I was given these options at the beginning, it could help to resolve this matter in a better way and earlier.


And these are their answers:

1- You were aware of the position from the start. As you point out you had declared everything. Your car was certainly declared and listed on the statement of affairs as an asset. As far as I can tell from the file there is no suggestion that it was ever considered an exempt asset.

2- The exemption limit which applied at the start of your sequestration does not entitle you to a £1,000 allowance from the proceeds of the insurance claim. The policy claim represents the value of the car, which vested in the trustee. The insurance proceeds therefore also vest in the trustee.

3- The “advice” which you suggest we should have given to you would not have been appropriate.


Spoke to AiB yesterday, but they said I have to resolve this with my IP on my own, as my sequestration is still 'alive'. Unless I want to file a complaint against my IP, then I can put it in writing to AiB. But I believe this will prolong my sequestration. And I am so looking forward to be released. :( Oh dear.. SO STRESSED.
#27335
Hi Mikey

Sorry to hear about your situation. From the response you have got from the Trustee it sounds as though the person who has responded is not the person you originally dealt with and who told you they would not touch the car. I have to say the person you are dealing with now seems extremely unhelpful. From the posts so far I can not understand what they are talkign about in their point "2" when they refer to an insurance claim??

Overall this is a very unfortunate situation and I fear that it may not be one that you are able to win. Is there anyone you know who might be able to help you offer a lump sum to the Trustee so you can keep the car and then draw a line under the whole thing?
#27358
Hi Mikey

This really does seem as though you have been treated unfairly especially as you say you have always been up front from your side. The answers 2 & 3 below I find particularly unhelpful and unsatisfactory....

Nevertheless, the problem is that you are now in a "I was told this" "No you weren't" arguement which will be almost always impossible to win with the Trustee. As such it might be best to try to come to some agreement on the value of the car over £1000 and thus a settlement amount.
#27361
Hi all,

Just thinking to update this thread. Carla, the insurance that they meant was about the valuation that they used to value my car. My insurance company claimed that the value of my car is £1550. And they used this figure as an asset on my name.

Hayden, yes you are definitely right. I would never win in this situation. After a series of long conversation with them, they definitely want some more money from me, end of discussion. So, I offered them the amount that I could afford, and finally we agreed on the amount that could make both parties settling down. They said they are taking my good record into account, and they agreed to receive £400 as a settlement, rather than £775.

Honestly, I am not 100% happy with this. But I know if I keep on arguing with them, the chances for me to win this is very thin. Plus it will prolonged my sequestration.

The lesson that I could share from this, please have everything recorded in black and white from your trustee. You'll never know! Thanks everyone for your kind advices and words.