Friday, 30 April 2021
Personal Insolvency (Amendment) Bill 2020: Report and Final Stages
I reiterate my point that the fact this cut-off date existed was recognised in a number of court decisions as an important counterbalance and that counterbalance has been taken away. The objection that the amendment does not specify the proofs that a debtor would need is, arguably, misconceived. The proofs depend on the facts of individual cases and legislation does not usually exhaustively list evidential proofs. This whole process is not supposed to be a mere tick-the-box exercise. It is about establishing eligibility as a matter of fact. If debtors did co-operate with their lender, as the Minister of State said, the lender would have a record of that and there would be no need to prove it because it would not be put in issue. A creditor's mortgage arrears resolution process, MARP, is a formal documented process so it should be easy to prove or disprove participation.
Finally, while the Ali case is a rare example of a reserved decision on a personal insolvency practitioner's declaration, that is partly because most cases were heard, at first instance, in the Circuit Court. Again, the Minister of State should bear in mind that sections 91(1)(g) and 91(2) are rather toothless thresholds or defences against abuse of the system. Insolvency practitioners are in the position that they are asked to make declarations all the time. There is a significant temptation that some of these will be meaningless and just simply a box ticking exercise. I am aware of one case in Monaghan before Christmas, where a debtor who was later held not to be insolvent at all, had made no payments at all for four years despite admitting to having a surplus income of around €3,000 a month. The person had not engaged in any way with his lender. In that case, his practitioner had no qualms about certifying his eligibility, which was duly rubber-stamped by the Insolvency Service of Ireland. So I am just saying that the potential for abuse, which this amendment was intended to counter, is there and should not be underestimated. I have failed to persuade the Minister of State of the merits of my proposal so I will not push it any further but I did think that I should have an opportunity to reply to the points made by the Minister of State.