Discharge In Trouble.

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Frenzied

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Discharge In Trouble.
« on: February 01, 2015, 02:03:35 PM »
I have been in bankruptcy for 18 months. At the start, I made all my monthly required surplus payments that had been agreed on. Everything was going great for the first 6 months. I then changed jobs and my salary increased quite dramatically. I continued making the originally agreed upon surplus payments. Now my trustee advises me that I'm almost $5000.00 in arrears. Since there is no way I can pay that off in the next 3 months, I assume I won't be eligible for discharge at 21 months as originally set. I have checked the Bankruptcy and Insolvency Act and found that if the only opposition from the Trustee is because of my failure to make the required payments, He must ask the matter proceed to Mediation. Have I interpreted the Act correctly?? I have also looked up the Government booklet about Mediation and the matter appears to be too easy. It says, me, the trustee and mediator meet and come to an agreement. What types of agreements are normal?Can I offer to pay, 10, 20, or 30 percent of the balance and get off the hook. Any insight you can provide me would be appreciated.

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NotATrust-E

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Re: Discharge In Trouble.
« Reply #1 on: February 01, 2015, 06:15:12 PM »
You're right that mediation is required in this type of situation as per Section 170.1 of the Act. You can ask to pay whatever you want, but the trustee can just say no, which means that you'll be headed to court and you will (likely) get a conditional order for the amount that you owe plus whatever the trustee fees like charging (and the court accepts) for court costs. In general, there's no reason for the trustee to accept any less than what he is owed under the Act.

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Re: Discharge In Trouble.
« Reply #2 on: February 03, 2015, 11:26:16 AM »
Thank you so much for your reply. I am quite disturbed at the thought of this mediation process. I have searched the internet for similar cases to mine and can't find any. I was wondering if anyone out there has been through this mediation process and can give me a clue what to expect. I'm not sure how my trustee will proceed at this hearing. All through my bankruptcy he has been really helpful and sympathetic, but I'm afraid that since I have let him down and not paid my required amount, he will be out for vengeance. Would appreciate to hear from anyone. Thank you.

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busyman

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Re: Discharge In Trouble.
« Reply #3 on: February 13, 2015, 08:06:07 AM »
Sounds like your trustee based it on a higher surplus income. I don't think the trustee is out for vengeance.

Here is what I did .
I gave the trusted the first six months of my income as per there request.
Completed the two sessions and give my t4 slips.

What I am doing is keeping track of the rest of the income for the duration of my bankruptcy so when discrepancies comes up I have the statements to prove as to what I actually need owe.

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Frenzied

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Re: Discharge In Trouble.
« Reply #4 on: March 03, 2015, 04:50:24 PM »
I spoke to my trustee today and he advises me he will be opposing my discharge as I have not paid all my surplus payments. He went on to remind me that I had already been through a mediation process after 9 months of my bankruptcy. He cited Sec. 68(6) of the BIA where I disagreed with the amount  my monthly payments should be. Because of my increase in salary, my payments to the estate had more than doubled. I do not recall a mediation meeting with anyone other than my trustee, but he mentions a conference call I had at his office with another person and we did discuss the increase in payments. I do remember that day but not that it was mediation. Now with his opposition to my discharge looming and the need for "another"??? mediation process am I in big trouble? Does it look bad that I disputed my payments, agreed to them, didn't make them(kept making the original payments) and now am looking at mediation"again". I'm really in a state of fright.

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NotATrust-E

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Re: Discharge In Trouble.
« Reply #5 on: March 03, 2015, 07:36:50 PM »
I guess it's possible to mediate a second time...? I don't know if it's mandatory if it's been mediated before. If you've got the surplus income, you've got to pay the amount. I don't know if it looks bad per se, but the trustee is obligated to collect the money before you get your discharge.

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Frenzied

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Re: Discharge In Trouble.
« Reply #6 on: March 07, 2015, 11:30:10 AM »
Just one more question about filing my 2014 tax return. I declared bankruptcy in 2013. I hadn't completed by 2012 tax return at the time so my trustee did it and my refund went to the trustee. Similarly, trustee filed my two returns (pre and post bankruptcy) for 2013 and kept the refunds. Since it looks like I will continue to be in bankruptcy this year due to my discharge being opposed, am I responsible for filing my 2014 return or does the trustee continue to do so until I'm discharged? Who keeps the refund if there is any? Thanks for the help.

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NotATrust-E

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Re: Discharge In Trouble.
« Reply #7 on: March 07, 2015, 04:18:47 PM »
Based on my understanding, you are responsible for filing your 2014 taxes.

If you owed money to CRA and the debt was included in your bankruptcy, the CRA keeps the refund, if any. I'm not 100% sure, but I think that if you don't owe money to the CRA, the refund might be directed to the trustee, but I don't think they get to keep it. On the other hand, if you do get a refund, you should be able to apply any money received against the amount you owe the trustee.

 

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