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Max Lowry
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Category: Law
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Experience:  LLB, 10 years post qualification experience
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I am in an IVA which started 2007 and should have finished

Resolved Question:

I am in an IVA which started 2007 and should have finished 2011. The rules about PPI claims changed just before my IVA should have finished. Two of my creditors have paid the PPI compensation to themselves instead of into the "pot" for all creditors. This means that my IVA is still active 3 years 2months after it should have finished. Can I sue these creditors for financial loss ?
Submitted: 1 year ago.
Category: Law
Expert:  Max Lowry replied 1 year ago.
Hi, welcome to the site. My name is ***** ***** I will help you with your question. Could you please tell me are these two creditors included in the IVA? I can't see any reason why they should be unless they are secured creditors. Please let me know. Also, what did your Supervisor say about it? Thanks
Customer: replied 1 year ago.

Yes they are secured creditors. My supervisor has said that they have used their PPI re-payment against their own balance but are still requiring a equal share of the IVA repayments.

He says until they comply with the requirements of the IVA to pay the PPI into the "pot" for distribution among ALL the creditors the IVA cannot be closed.

Expert:  Max Lowry replied 1 year ago.
Ok. Thanks for the additional information. Do these two creditors also have a unsecured claim in the IVA?
Customer: replied 1 year ago.

I don't think so.

Expert:  Max Lowry replied 1 year ago.
That doesn't sound right. An IVA only binds unsecured creditors so your proposal does not effect the secured creditors. They aren't even entitled to vote on the IVA proposal.
Also, it sounds correct that the PPI awards were swallowed up by the secured creditor, which would have been in accordance with its terms and conditions. Really, your supervisor should have realised that this was a possibility when he/she put the proposal together. Of course now, the PPI awards have been swallowed up and will not be available for your unsecured creditors.
If the supervisor is still waiting for the money to come into the IVA I cannot see any possibility of it happening. It's not your fault your IVA will be prolonged.
The supervisor needs to agree to vary the terms of the IVA and ask your creditors to agree to it. There will be less money coming into the IVA and the creditors should be asked whether they will now agree to receiving a lesser sum. In this day and age, something is better than nothing and hopefully your creditors will agree to vary the terms of the IVA.
I hope this helps.
Max Lowry, Advocate
Category: Law
Satisfied Customers: 1457
Experience: LLB, 10 years post qualification experience
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