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Jo C.
Jo C., Barrister
Category: Law
Satisfied Customers: 70180
Experience:  Over 5 years in practice
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My daughter's husband's Son wanted a BMW car,

Resolved Question:

Hello
my daughter's husband's Son wanted a BMW car, but, being under 21 my daughter's husband had to stand Guarantor for the finance company agreement. The car was involved in an accident and wrote off. The Insurance company paid the sum of £12,000.00, not to my son-in-law or the finance company, but to his son, who duly spent it. The first thing my son-in-law knew about the situation was when he received notification from a debt collector, that he owed £16,000.00 to the finance company and now has to meet payment of £400.00 a Month, which he cannot afford and is causing great hardship. Should the insurance company have paid the settlement to the finance company or my son-in-law and not the under aged son?
Submitted: 1 year ago.
Category: Law
Expert:  Jo C. replied 1 year ago.
Hi.
Thank you for your question. My name is ***** ***** I will try to help with this.
Is there any reason you think they may have had to do that?
Customer: replied 1 year ago.
I presume you mean why honour the debt. They were informed, by the debt collection agency, that they were responsible to re-pay the debt, commencing with an immediate payment of £1,200.00
Customer: replied 1 year ago.
I have been told that the figure for the first payment was almost £1,400.00, not £1,200.00
Expert:  Jo C. replied 1 year ago.
No, sorry.
But they would normally pay to their client
Was it written into the contract that they would clear the debt?
Customer: replied 1 year ago.
But he was under aged and his father had to stand guarantor . Should it not have gone to the father?
Expert:  Jo C. replied 1 year ago.
No.
The insurance company are not concerned with who guaranteed the finance deal. That is a separate contract.
Unless it was written into the contract that they would pay another person they are perfectly free to do this and under a duty to do so.
If your husband has to pay out under a guarantor agreement then he can always sue your son in law for the amount in question.
In fairness though, the fault does not lie with the insurance company.
I'm very sorry but I can only give you truthful information.
Can I clarify anything for you?
Jo
Customer: replied 1 year ago.
If my son-in-law sued his son and he had no money to give through the courts, would my son-in-law still be held responsible for the debt?
Expert:  Jo C. replied 1 year ago.
A guarantor can recover by suing an improvident debtor.
The claim in law is a sound one.
The question really is whether the debtor has any money or whether they are just people of straw. If so, it is good money after bad I'm afraid.
Customer: replied 1 year ago.
OK Thank you for the advice, it does not help my son-in-law but thanks
Expert:  Jo C. replied 1 year ago.
Never get involved in guarantors I'm afraid. If a person isn't a sound enough applicant in their own right then you don't want to be placing yourself at risk for them.
No problem and all the best.
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