LawAnswers.com.au - Australia's #1 Legal Community

LawAnswers.com.au is a community of 10,000+ Australians, just like you, helping each other.
Ask a question, respond to a question and better understand the law today!
Join us, it only takes a minute:

VIC How Do I Deal with Personal Bankruptcy?

Discussion in 'Debt and Bankruptcy Law Forum' started by Charles Charlie, 14 June 2014.

  1. Charles Charlie

    Charles Charlie Active Member

    Joined:
    14 June 2014
    Messages:
    5
    Likes Received:
    1
    I ran an online business for close to 12 months. Unfortunately it ran into some debt (while we aimed to go our sales), the business was set up in my personal ABN and name at this stage as it wasn't incorporated with my business partners. We shut the business down as it was making a loss. I now have my suppliers chasing me up and have an official complaint arrive which I must do something about in 21 days.

    I did have a friends lawyer helping me out, but he has not gotten back to me and I am starting to really freak out. I don't believe I was being unethical in anyway, genuinely tried to run a business but due to some poor decisions I happen to be in this situation. I simply do not have the money to pay back my suppliers.

    Can someone please offer any advice? Direction for debt consolidation? Anyone know a lawyer I can speak with, I am from Melbourne.

    Thanks
     
  2. John R

    John R Well-Known Member

    Joined:
    14 April 2014
    Messages:
    637
    Likes Received:
    165
    Hi Charles,
    1. I understand that you were operating the business under your personal ABN (Sole Trader). Did you have a separate agreement with your business partners in relation to their financial contribution to the business?
    2. When you refer to an "official complaint" - Can you please elaborate on what the document/complaint is?
     
    DennisD likes this.
  3. Charles Charlie

    Charles Charlie Active Member

    Joined:
    14 June 2014
    Messages:
    5
    Likes Received:
    1
    Hi John,

    Thanks for the reply.
    Sure so -

    1. As it was an online business, my partners were purely doing tech work for equity and had no other financial involvement in terms of contribution etc
    2. It's headlined with - "Magistrates' Court General Civil Procedure Rules 2010 - Form 5A"
    Essentially my options are - I can defend the claim, make the payment, or arrange an alternative solution privately. Either way I must respond in 21 days.

    - This has only come from 1 of my suppliers who I owe money to.

    I just did some googling and can see I can apply for voluntary bankruptcy - but their seems to be long term consequences with that. This was a genuine business failure and I don't want it to be affecting me in the future with any potential new businesses. Something I do want to do.

    I just sent an email to my debtors. Explaining my situation as honest as possible and requested a monthly payment plan over 12 months with each of them and 18 months for another as it was a substantially larger amount. If they agree to this I will then just need to find a way to make the payments. Which I do agree is only fair, they run a business also and I have personal ethics and morals also.

    Thoughts? Any further advice/direction John?

    Once again Thank you!
     
  4. John R

    John R Well-Known Member

    Joined:
    14 April 2014
    Messages:
    637
    Likes Received:
    165
    Hi Charles,
    Dealing with the failure of a business is never easy but you've already started the most practical first step towards managing your debt - that is, contacting each creditor and starting informal negotiations to manage your debt.

    You may also consider contacting MoneyHelp, a not-for-profit service supported by the Victorian and Australian Governments.
    MoneyHelp provides free, confidential and independent financial counselling advice to Victorians who are experiencing financial difficulty
    . You can call MoneyHelp's free financial counselling service on 1800 007 007.
    You may also want to review MoneyHelp's Your Debt Options resource for additional practical information.

    All the best for the future - many successful entrepreneurs and businesspeople have failed (and some, multiple times) before they've succeeded!
    Please keep us updated as to your progress.
     
  5. Charles Charlie

    Charles Charlie Active Member

    Joined:
    14 June 2014
    Messages:
    5
    Likes Received:
    1
    Hi John -

    Apologies for the late reply and thank you so much for the information above.
    I have contacted my creditors and only 2 have responded. I have made a payment plan arrangement with them for the next 12 months.

    Do you know of a lawyer I could speak to otherwise for my other creditors?


    Thanks
     
  6. John R

    John R Well-Known Member

    Joined:
    14 April 2014
    Messages:
    637
    Likes Received:
    165
    Hi Charles,
    Sounds like you've made a good start in gaining better control of your debt.
    1. Did you just email your creditors or have you followed-up with a letter and/or phone call?
    2. Have you contacted the MoneyHelp service or are you immediately looking to retain a lawyer?
     
  7. Charles Charlie

    Charles Charlie Active Member

    Joined:
    14 June 2014
    Messages:
    5
    Likes Received:
    1
    Hi Charles,

    Thanks you.
    Yes I have followed up with them. I am super stressed out. I don't know what to do. Even with the private agreements, I don't have a job at the moment and not sure how I will make the monthly payments. Have just contacted MoneyHelp - they took my details and will call me back.

    I just want to speak to a decent honest lawyer who can give me suggestions on what I can do and/or help me negotiate something so I can just have a little more time to get back on my feet (and mentally) to get through this.

    It really sucks!
     
  8. Tim W

    Tim W Lawyer

    Joined:
    28 April 2014
    Messages:
    1,713
    Likes Received:
    402
    You will have no trouble finding one of these.
    There are far, far more "decent honest" lawyers than any other kind.

    Most lawyers who do commercial law work will be able to assist you with this.
    Yes, there will be fees involved, but you can discuss that with your chosen lawyer.
     
    DennisD and John R like this.
  9. Charles Charlie

    Charles Charlie Active Member

    Joined:
    14 June 2014
    Messages:
    5
    Likes Received:
    1
    hey guys! Just wanted to say thanks for all the help with the answers above. I have managed to pay majority of the debt off with a payment plan in place for the remaining amount. Thanks again.
     
    John R likes this.
  10. John R

    John R Well-Known Member

    Joined:
    14 April 2014
    Messages:
    637
    Likes Received:
    165
    Thanks for the positive update @Charles Charlie. All the best in your future business endeavours!
     

Share This Page

Loading...