WA Bankruptcy - Am I Responsible for Wife's Debt?

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16 February 2016

I am new to this and need some help.

18 months ago, my wife was declared bankruptcy over Credit Card Debts. We had a mortgage under both names and joint accounts. I had no idea of her credit card debts and she never attempted to resolve any debt. Accounts were frozen and she had to come clean.

At Bankruptcy, she had a debt of approx. $15000.00 and legal fees blew it out to about $28000.00. Yes, we were ripped off + another $12000.00 in transfer costs. I just wanted to clear everything up and Annul the Bankruptcy. The house was refinanced into my name only and with the refinance I paid out the Bankruptcy.

The house is now solely in my name but we still have joint accounts that I have been controlling, Recently, I have noticed she has been applying for more credit (Unfortunately, I have to intercept mail that I think may be to do with trying to get credit).

What I would like to know is if she does get credit approved without me knowing, am I liable for any of the debt if she ran into trouble again? Fortunately, as far as I'm aware, she has not received credit yet. And would it be the same scenario if I was to get rid of the joint accounts and have separate accounts?



Hi Paulau,

When joint debts are owed jointly (as opposed to being solely in your wife's name), you will be jointly and severally liable for them. This means that the bank (or whoever you owe) can come after both of you or either one of you for payment of the whole debt. You would also be affected by her bankruptcy if she is a partner in your business, you guaranteed her debts or encumbered your assets to secure her debts.

However if simply have joint bank accounts and your wife was to go bankrupt, the trustee can only take what she contributed to the account. If you own a house jointly the trustee could take only her share of the house.