The Minister for Justice signed the new bankruptcy legislation on the 3rd of December 2013 reducing the period of bankruptcy from 12 years to 3 years.
This follows on from the first debt settlement agreement which had been reached and which saw 70% of the unsecured debt written off.
The new legislation will provide an outlet for debtors who cannot reach a debt settlement arrangement with their creditors or where their proposed debt settlement arrangement proposals has been refused.
The first 7 bankruptcy cases came before Mr Justice Brian McGovern on Monday the 9th – 4 were personal applicants and 3 were made bankrupt by a creditor.
A personal applicant must show that he/she has made an attempt to resolve his/her financial difficulties using one of the new personal insolvency arrangements without success.
In one case coming before Mr Justice McGovern the debtor stated that he had surrendered his property to the bank but that the bank were unwilling to arrive at a satisfactory arrangement regarding the outstanding balance of the loan. The debtor was not represented in court by a solicitor or barrister but was assisted in his application by a “McKenzie friend”.
For more about a McKenzie friend press here
In this case the McKenzie friend was a Personal Insolvency Practitioner who’s office provided secretarial assistance to help clients fill in the bankruptcy forms and have the documents lodged in the Examiner’s office. The McKenzie friend can also attend the official assignee’s office when the bankrupt is being interviewed.
In this particular case the charge was €2,000 to include €650 required to be paid by the official assignee’s office.