Why not get an order to garnish his wages or seize assets to the value of? You might get more money back if you have his wages garnished.
After tax, he will get about $75k. He should be able to pay back that money at $1750/month. That leaves him with enough money to live on, and you actually get your money back in 12 months.
He learns to pay money back, but it doesn't ruin him financially.
Why spend another few thousand bankrupting him to get nothing? Get garnishee orders and garnish his bank and his employer, also send the sherrif around to put pressure.
Court civil judgements are enforced by the Sheriff/bailiff.
Court criminal judgements are enforced by police/corrections.
They are usually called property seizure and delivery orders for repossessing shit, seizure and sale orders to take and sell to repay money owed.
Unlikely you’ll get anything after trustee fees if he only earns 100k before tax and no assets, but you can make him bankrupt.
Source - prior insolvency exp for 6 years in bankruptcy
If this is the only debt, then I think it's unlikely to result in OP needing to get a sequestration order. It might just be a wake-up call. That said, if he has several debts...
Remember, OP, you don't want to **drive** him to bankruptcy; you want to reclaim your owed funds.
A Part IX debt agreement or Part X PIA would be the better option. Depending on assets and any other debts they could get all/ majority of it paid back with an administrator managing the instalments.
"\[Negative consequences\] *include the loss of your home and other assets, making it difficult for you to obtain credit and limiting your employability. If you declare bankruptcy, your name will also be listed on a public record, the National Personal Insolvency Index.*"
[https://ndh.org.au/debt-solutions/bankruptcy/](https://ndh.org.au/debt-solutions/bankruptcy/)
it would seem silly to declare bankruptcy with such a small dept with a income that high.. clearly just a full time jurk
if he does bankrupt he will be on 100K and be unable to get any loans or credit cards, not even a phone plan for like 7 years. not to mention the employment problems it could cause.. no one will trust a bankrupt with any form of management role.. stuck at the bottom sweeping floors.. its in his best interest to pay up
1. Its not 7 years, its 3 years.
2. He wont be able to take a tole where he is giving financial advice.
3. Stuck at bottom sweeping floor? ( what does this even mean? ) nothing will happen. It will be cleared from file after 3 years and everything will be normal
> it would seem silly to declare bankruptcy with such a small dept with a income that high.
exactly, would he even be able to do it. You can just "declare bankruptcy", the afsa has to accept your application.
If he’s on 100k salary he’s probably a working professional. Most contracts I’ve had include bankruptcy as a cause for termination (especially if you work in any sector where corruption / ethical work is of concern)
Why straight to bankruptcy notice and not a garnishee order? Are there other debts?
As someone else commented, after tax income is used to determine contributions to a bankruptcy estate, then the trustee fees are paid, then contributions are distributed amongst creditors. If your cousins owes others you won’t get the balance entirely, so over the 3 years how much have you estimated you’ll actually receive?
There are also some jobs that are impacted by being bankrupt, so if they’re employed in those fields you could have removed the income source and really get nothing, instead of next to nothing.
The figures for protected assets and income thresholds are indexed, and for contributions will vary depending on dependents.
You can read about the consequences of bankruptcy on the AFSA website before deciding if you want to proceed with a sequestration order if he’s unable to comply with the bankruptcy notice. There are other options to try and recover your money short of bankruptcy though
What sort of judgment do you have against him? If it's a default judgment you can still apply for enforcement orders but he can also apply to set aside the judgment after satisfying a few things in accordance with the rules.
Does he own property or a decent vehicle? Apply for a warrant of sale on real property. The sheriff will then take possession of and sell said property and pay you what he owes you, then your cousin gets the balance after the relevant fees are paid.
IANAL
When he goes Bankrupt it's very possible he's going to have some issues with his employment. Many employers specifically have it outlined in contract that a bankruptcy can be reason for termination from employment.
Onwards from that it's going to be like any other bankruptcy which makes life very difficult.
He'll likely have to sell **any** assets such as Cars, Houses, Stocks etc. It's also going to be next to difficult / impossible for him to get any credit such as loans, phone plans etc for the next 10 or so years as when he files his credit score will essentially be zero.
It's not a decision to take lightly, which is why it's good you're seeking advice.
When you say he's not honouring your agreement, do you mean he's refusing to pay it back at all or just not the agreed timeframe / amount / interest?
If he goes bankrupt pretty much all debts are written off to it's unlikely you'll see a cent after fees etc, hence it may be in your best interest to work/compromise with him to at least recuperate some money.
Just make sure you get everything in writing.
Shouldn't this type of information go both ways? I understand that OP doesn't want to bankrupt his bro, but his bro also needs to understand what would happen to himself when he doesn't pay money back and is forced into bankruptcy instead of paying back the $21k
Sometimes (many times?) people don't know or only understand a small portion of the whole situation/seriousness/consequences of the results from their own actions/inactions
Also sometimes it seems difficult to get this kind of information, even if OP explains it his bro might not believe what OP says after being taken to court, even if OP's just trying to help him out
I 100% agree with you.
It **should**, but sadly often does not, whether that be through lack of care or education who knows.
I've not instructed OP to make a specific decision, only provided some personal advice on what might work for him based on the situation. By the tone of OP's post he's not looking to ruin his Cousins life, he just wants his money back.
It OP's call as to what he wants to do, it's not up to us to tell him he needs to go in either direction. We're just here to provide the best advice we can to help him make his decision.
While you can bankrupt him it does not give you back what you lose.
For him, if he has nothing he will do a few hard years and get back on his feet.
mIL went in to bankruptcy, couldn’t get loans for a few years and she now owns a 10 acre property now..
I would look at a garnishing order. Slowly but surely you’ll get your money.
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Employ a collections agency and get a garnishee order against him. Your payments will then come direct from his wages.
Don't engage personally, and if you do, ensure you have a detailed record (emails, screen shots, recorded delivery receipts etc).
You wouldn’t need to garnish his wages if he went bankrupt. In all likelihood, he’d be an income contributor to the bankrupt estate.
Search ‘income contributions, Australian bankruptcy’.
Bankruptcy lasts a minimum of 3 years and upto 7 years. They will sell most assets and repossess anything with a loan on it. Any outstanding money owed will be taken after he earns over a certain threshold through the financial year @50cents to the dollar. So being on $100k you will more than likely get your money back but it will be a long and slow process and also depends who else he owes money to
21k isn't that much of a debt. What other trouble is he in? If he pays $100 a week which would be easy to pay if you make 100k should be paid back under 5 years.
Care as much as he cares paying you back the $21k
Why not get an order to garnish his wages or seize assets to the value of? You might get more money back if you have his wages garnished. After tax, he will get about $75k. He should be able to pay back that money at $1750/month. That leaves him with enough money to live on, and you actually get your money back in 12 months. He learns to pay money back, but it doesn't ruin him financially.
Why spend another few thousand bankrupting him to get nothing? Get garnishee orders and garnish his bank and his employer, also send the sherrif around to put pressure.
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Sans serif
Australia has sheriffs - they're not like American sheriffs (elected cops) though, they're more like court muscle - who enforce warrants and stuff.
Court civil judgements are enforced by the Sheriff/bailiff. Court criminal judgements are enforced by police/corrections. They are usually called property seizure and delivery orders for repossessing shit, seizure and sale orders to take and sell to repay money owed.
The sheriff's office, among other things, serves court orders and handles the seizure and sale of personal assets and property.
Unlikely you’ll get anything after trustee fees if he only earns 100k before tax and no assets, but you can make him bankrupt. Source - prior insolvency exp for 6 years in bankruptcy
If this is the only debt, then I think it's unlikely to result in OP needing to get a sequestration order. It might just be a wake-up call. That said, if he has several debts... Remember, OP, you don't want to **drive** him to bankruptcy; you want to reclaim your owed funds.
A Part IX debt agreement or Part X PIA would be the better option. Depending on assets and any other debts they could get all/ majority of it paid back with an administrator managing the instalments.
Garnishee his wages.
"\[Negative consequences\] *include the loss of your home and other assets, making it difficult for you to obtain credit and limiting your employability. If you declare bankruptcy, your name will also be listed on a public record, the National Personal Insolvency Index.*" [https://ndh.org.au/debt-solutions/bankruptcy/](https://ndh.org.au/debt-solutions/bankruptcy/)
it would seem silly to declare bankruptcy with such a small dept with a income that high.. clearly just a full time jurk if he does bankrupt he will be on 100K and be unable to get any loans or credit cards, not even a phone plan for like 7 years. not to mention the employment problems it could cause.. no one will trust a bankrupt with any form of management role.. stuck at the bottom sweeping floors.. its in his best interest to pay up
1. Its not 7 years, its 3 years. 2. He wont be able to take a tole where he is giving financial advice. 3. Stuck at bottom sweeping floor? ( what does this even mean? ) nothing will happen. It will be cleared from file after 3 years and everything will be normal
> it would seem silly to declare bankruptcy with such a small dept with a income that high. exactly, would he even be able to do it. You can just "declare bankruptcy", the afsa has to accept your application.
If he’s on 100k salary he’s probably a working professional. Most contracts I’ve had include bankruptcy as a cause for termination (especially if you work in any sector where corruption / ethical work is of concern)
Why straight to bankruptcy notice and not a garnishee order? Are there other debts? As someone else commented, after tax income is used to determine contributions to a bankruptcy estate, then the trustee fees are paid, then contributions are distributed amongst creditors. If your cousins owes others you won’t get the balance entirely, so over the 3 years how much have you estimated you’ll actually receive? There are also some jobs that are impacted by being bankrupt, so if they’re employed in those fields you could have removed the income source and really get nothing, instead of next to nothing. The figures for protected assets and income thresholds are indexed, and for contributions will vary depending on dependents. You can read about the consequences of bankruptcy on the AFSA website before deciding if you want to proceed with a sequestration order if he’s unable to comply with the bankruptcy notice. There are other options to try and recover your money short of bankruptcy though
You don’t owe family anything. If he took you for a ride, take him on one in return.
What sort of judgment do you have against him? If it's a default judgment you can still apply for enforcement orders but he can also apply to set aside the judgment after satisfying a few things in accordance with the rules. Does he own property or a decent vehicle? Apply for a warrant of sale on real property. The sheriff will then take possession of and sell said property and pay you what he owes you, then your cousin gets the balance after the relevant fees are paid. IANAL
When he goes Bankrupt it's very possible he's going to have some issues with his employment. Many employers specifically have it outlined in contract that a bankruptcy can be reason for termination from employment. Onwards from that it's going to be like any other bankruptcy which makes life very difficult. He'll likely have to sell **any** assets such as Cars, Houses, Stocks etc. It's also going to be next to difficult / impossible for him to get any credit such as loans, phone plans etc for the next 10 or so years as when he files his credit score will essentially be zero. It's not a decision to take lightly, which is why it's good you're seeking advice. When you say he's not honouring your agreement, do you mean he's refusing to pay it back at all or just not the agreed timeframe / amount / interest? If he goes bankrupt pretty much all debts are written off to it's unlikely you'll see a cent after fees etc, hence it may be in your best interest to work/compromise with him to at least recuperate some money. Just make sure you get everything in writing.
Shouldn't this type of information go both ways? I understand that OP doesn't want to bankrupt his bro, but his bro also needs to understand what would happen to himself when he doesn't pay money back and is forced into bankruptcy instead of paying back the $21k Sometimes (many times?) people don't know or only understand a small portion of the whole situation/seriousness/consequences of the results from their own actions/inactions Also sometimes it seems difficult to get this kind of information, even if OP explains it his bro might not believe what OP says after being taken to court, even if OP's just trying to help him out
I 100% agree with you. It **should**, but sadly often does not, whether that be through lack of care or education who knows. I've not instructed OP to make a specific decision, only provided some personal advice on what might work for him based on the situation. By the tone of OP's post he's not looking to ruin his Cousins life, he just wants his money back. It OP's call as to what he wants to do, it's not up to us to tell him he needs to go in either direction. We're just here to provide the best advice we can to help him make his decision.
Money is evil bro it changes people
While you can bankrupt him it does not give you back what you lose. For him, if he has nothing he will do a few hard years and get back on his feet. mIL went in to bankruptcy, couldn’t get loans for a few years and she now owns a 10 acre property now.. I would look at a garnishing order. Slowly but surely you’ll get your money.
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Very sad. Did he attend Court, was there a mediation conference, bankruptcy will stuff him up for years and you may not get anything
Employ a collections agency and get a garnishee order against him. Your payments will then come direct from his wages. Don't engage personally, and if you do, ensure you have a detailed record (emails, screen shots, recorded delivery receipts etc).
You wouldn’t need to garnish his wages if he went bankrupt. In all likelihood, he’d be an income contributor to the bankrupt estate. Search ‘income contributions, Australian bankruptcy’.
Bankruptcy lasts a minimum of 3 years and upto 7 years. They will sell most assets and repossess anything with a loan on it. Any outstanding money owed will be taken after he earns over a certain threshold through the financial year @50cents to the dollar. So being on $100k you will more than likely get your money back but it will be a long and slow process and also depends who else he owes money to
In Queensland you can go to QCAT
21k isn't that much of a debt. What other trouble is he in? If he pays $100 a week which would be easy to pay if you make 100k should be paid back under 5 years.