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IVA : What is 'The Creditors Meeting'?
If you are considering using an Individual Voluntary Arrangement (IVA) to resolve your debt problem you may have heard reference to "The Creditors Meeting", and be wondering what a creditors meeting is.
So here is a brief description of what a creditors meeting is all about.
When the insolvency practitioner has received the signed Individual Voluntary Arrangement IVA proposal from you, the next task is to lodge the proposal with the courts, and then set a meeting for all your creditors to attend.
The purpose of the Creditors Meeting is to allow your creditors an opportunity to pass a vote on your proposed Individual Voluntary Arrangement (IVA). When a creditor agrees with the proposed Individual Voluntary Arrangement they will vote in favour of it, if they do not agree with your proposed Individual Voluntary Arrangement they will vote against it.
The creditors need to be given notice of the Creditors Meeting, and there is a minimum period of time that must pass between the proposal being lodged in court, and the date that is set for the Creditors Meeting to take place. This is a statutory 14 days, but in reality it usually is set for between 21 days and 28 days after the proposal has been lodged in court. This is to allow for enough time for all the creditors to be properly informed and prepared.
As mentioned before, the Creditors Meeting is set to give the creditors an opportunity to vote on your proposed Individual Voluntary Arrangement (IVA). The meeting itself is more like a virtual meeting, as it is not a meeting that they must attend in person. Indeed, most votes for the Individual Voluntary Arrangement are cast by fax, telephone or post, and it is unusual for a creditor to actually be present, though this is possible, should they wish.
Equally, there is no requirement for the debtor to be present at the Creditors Meeting. However, the debtor must make themselves available by a telephone should it be necessary for the Insolvency Practitioner to contact them whilst the meeting is being held, just in case there are any issues that need to be clarified immediately.
It is possible for creditors to vote before the meeting is held. If this happens, the vote will be held on file and counted as normal when the Creditors Meeting is held.
For the Individual Voluntary Arrangement proposal to be agreed at the Creditors Meeting, and therefore become legally binding, there must be in excess of 75% (of the monetary value) of votes cast 'in favour' of the Individual Voluntary Arrangement (IVA) by the creditors.
The Creditors Meeting can be adjourned at any time, for any duration, for up to a maximum of 14 days after the original meeting date. This allows the debtor or creditors time for consideration should any modifications be requested, or indeed should there be a situation where there are no creditor votes cast at all.
It is not unusual for some creditors to miss out on casting their vote at the Creditors Meeting. This could be for many reasons, but in general it would be down to the size of the Individual Voluntary Arrangement workload they are experiencing, which, as you've probably read, is growing all the time.
If you would like further information on this subject, or any aspect of the Individual Voluntary Arrangement (IVA) process then call myIVA-Adviser.com on 0800 088 7503 now for a free and confidential chat with one of our Individual Voluntary Arrangement specialists.
