If you've received a personal insolvency agreement proposal (PIA), someone who owes you money is making a formal offer to renegotiate payments. They base their offer on what they can afford.
The person who owes money appoints a controlling trustee[?] who manages the process.
The controlling trustee:
- takes control of the person's property
- puts forward a proposal to creditors[?]
- prepares a report that compares what you get from the PIA as opposed to the person entering bankruptcy[?]
- organises a meeting of creditors within 25 working days (except in December when it is 30 days) of their appointment.
At the meeting of creditors, the trustee will ask you to consider and vote on the agreement proposal.
You are able to ask questions of the person who owes you money to help you decide how to vote.
For more information see: About meetings of creditors
For creditors to accept the proposal, the majority of creditors and 75% of the dollar value must vote yes. We call this a special resolution.
How do I vote?
You will need to attend a meeting of creditors.
The controlling trustee sends you the following at least 10 days before the meeting:
- notice in writing of the date, time and place of the meeting
- the trustee's report
- the trustee's statement about resolutions to vote on, and
- an estimate of the trustee's costs for managing the agreement.
If you would like more information about the proposal, contact the trustee.
If you're unable to attend the creditor's meeting, contact the trustee to discuss if you can:
- vote by teleconference or
- appoint a proxy[?] or attorney to vote on your behalf.
If creditors accept the agreement
- You must comply with the terms of the agreement.
- Creditors must select a trustee to manage the terms of the agreement. This is normally the same person as the controlling trustee, but creditor's can choose another trustee.
For more information, see They're in a personal insolvency agreement, what now?
If creditors don't accept the agreement
Creditors can, by special resolution vote to either:
- hand back control from the trustee to the person who owes money or
- require the person who owes money to present a debtor's petition[?] within 7 days of the special resolution.
Creditors can also decide to not make a special resolution.
If this happens, the controlling trustee retains control over the persons property until whichever of the following happens sooner:
- four months pass from the date they appoint the controlling trustee
- the person becomes bankrupt
- a court releases the property from the trustee's control or
- the person dies.