QLD Can I be Affected by My Boyfriend's Debt?

[Hoffa1981]

Approximately ten years ago, my boyfriend had a car repossessed and was taken to court over the matter. No payments were made and nothing was settled. I was not with him during the time He recently tried to obtain a credit report as we were thinking of applying for a house. Now he is concerned that he may be found by debt collectors.

We live together and have a joint bank account. My question is, can they drain our joint savings? Will the money be protected if I transfer directly into my account? We bought our car together but this is in his name, is it protected if put in my name?

At what point does the debt become uncollectible, if this even applies?

Thank you in advance and please excuse my ignorance.

 

[Sophea]

Hi Hoffa1981,

Firstly some limitation periods apply to old debts. They are as follows:
For most debts (as long as a court judgement as not been entered), a creditor must begin court action to recover the debt within 6 years of the date:

• on which the debt became due and you didn’t pay; or
• that you last made a payment; or
• that you admitted in writing that you owed the debt.

The limitation period starts from the latest event in the above list.

However if a court judgment has been entered, a 15 year limitation period applies. After that time period expires the debt is statute barred and cannot be enforced against your boyfriend. If you are still within those periods of time however your boyfriend remains liable for the debt.

Secondly, there are clawback provisions in bankruptcy and other legislation which prevent debtors from quickly disposing of their property before creditors come knocking. They can claw it back from the transferee (you).

Thirdly, his debts are his debts and will be paid out of his assets. Couples are not bankrupted. Individuals are. Therefore your assets should to a large degree be safe, including jointly held funds.