Question: I own a property with my business partner, and although we do not have a formal partnership agreement, we do own the property as tenants in common with a 50 per cent share each. We are in the middle of selling the property and I understood that contracts were to be exchanged any day now. My partner has been dealing with the legal side as I have been away for the past five months. However, having returned to the UK, I have been told by my partner that he has been made bankrupt. What should I do now?
© Malcolm Willett (www.willett-ink.co.uk)
Answer: If your partner has been made bankrupt, a Bankruptcy Order will have been made against him. A Trustee in Bankruptcy will be appointed to look after his affairs and to ensure that he does not dispose of any assets.
This means that your partner cannot sell his share in your jointly owned property
unless his Trustee in Bankruptcy consents to the sale. The result is, of course, that you will be prevented from selling the property until the Trustee in Bankruptcy has investigated your partner's affairs and decides whether the property can be sold.
The Trustee in Bankruptcy will wish to be a party to the sale transaction. So it is vital that you make contact as quickly as possible and establish his or her thoughts on the matter. You should also contact the solicitor who has been dealing with the sale for you, and your partner to ensure that he is fully aware of the situation.
It is quite amazing how many clients do not keep their lawyer fully in the picture and the advice your solicitor can give is limited if he is not aware of all the facts.
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If you have a question for Fiona McNulty, email email@example.com. We regret that questions cannot be answered individually.
Fiona is a partner in the property team at Thring Townsend Lee & Pembertons Solicitors www.ttuk.com.