I have a few questions about debt/collection laws and statue of limitations in Ontario.
I have a debt load of just under $14,000 (Citifinancial is the company which holds my debts).
At present, I am working and living in S. Korea as an English teacher.
In June of 2007, the private school I was working for closed and it took me some time to find a new job. Shortly after this, in August of 2007, I was hospitalized after being hit by a motorcycle. During this time, the last thing on my mind was my debts.
Of course, Citi was calling my house in Canada (where I no longer live), sending me letters there and in some cases asking my parents to pay off my debts for me. I had my parents, my (new employer) and my doctors write letters and explain what was happening, but Citifinancial didn't respond to the letters. I don't know *why* Citi is being so unreasonable with this, but the fact is, they are.
I never had any intention of ducking out of the debt I owe, but now after speaking to a collection agency hired on behalf of Citifinancial, they are demanding the full amount I owe them ($9000+). I've tried negotiating a settlement with them, and I was told that I "could probably pay $6500" and have it closed out (that's a direct quote). Seeing as I don't have $6500 either, this is not an option for me.
I've had discussions with two credit counseling services, but the fee they are asking for is also too high for me to manage (one was asking for $1200/mnth, the other $1100/mnth)
I understand that I can not legally start bankruptcy proceedings, as I'm not in Canada at present.
So, here are my questions.
1). I've not made any payment to these companies in almost a year (I'm sure it's over a year). I've read somewhere that there is a two year statue of limitations for debt in Canada. I've also read there is a 7 year S.O.L. Is either of that true?
2). Can a company somehow start a legal proceeding against me while I'm in a foreign country?
3). If they can, how could I go about defending myself from Korea? I've read that if legal proceedings are started against an individual and that person doesn't respond to the court, then a judgment is automatically found against that person. Is that true?
4). Would a judgment/legal proceedings/debt issues prevent me from entering Canada in the future? I'm planning on being in Korea for (at minimum) another year, but I would hate for any of this to stop me from being able to come home at Christmas or on vacation.
I'm really at a loss as to how to handle this. Like I said initially, I don't want to duck my responsibilities here, but at the same time, Citi is being quite unreasonable (in my opinion) and I'm really stuck between a rock and a hard place.
Any and all help would be greatly appreciated!

Paul

There is no Statute of Limitations in Ontario regarding debts. Creditors can pursue you for as long as they want.

However, practically, once a debt is a few years old the chances of the creditors pursuing you are greatly diminished.

More importantly, you are not living in Canada, so even if Citifinancial were to obtain a judgment against you in an Ontario court, it would be impossible for them to enforce that judgment outside of Ontario. To pursue you in Korea, they would need to go to court in Korea, and there is no chance that Citifinancial would pay the amount of money necessary to hire lawyers in a foreign jurisdiction.

I would suggest that you continue to do what you have done: advise Citifinancial that you are unable to pay, and that you will deal with the debt if and when you return to Canada.

If you do return to Canada, even temporarily, you may file bankruptcy, or perhaps a consumer proposal to deal with your debts. You can read up on consumer proposals here: Consumer Proposal: Debt Negotiation and Settlement with a Consumer Proposal (http://www.moneyproblems.ca/consumer-proposals.htm)

Good luck.

Thank you. I really appreciate your answering my question(s).
If I could impose and ask you to clarify something (if you don't mind). Is it true that if Citi does take me to court and I am not there to answer the summons, then a judgment is automatically imposed against me?
That's the one side of this I'm unsure of. And if that were true, what would happen in that case?
Regardless, my sincerest thanks for your answering my question.

Regards,

Paul


There is no Statute of Limitations in Ontario regarding debts. Creditors can pursue you for as long as they want.

However, practically, once a debt is a few years old the chances of the creditors pursuing you are greatly diminished.

More importantly, you are not living in Canada, so even if Citifinancial were to obtain a judgment against you in an Ontario court, it would be impossible for them to enforce that judgment outside of Ontario. To pursue you in Korea, they would need to go to court in Korea, and there is no chance that Citifinancial would pay the amount of money necessary to hire lawyers in a foreign jurisdiction.

I would suggest that you continue to do what you have done: advise Citifinancial that you are unable to pay, and that you will deal with the debt if and when you return to Canada.

If you do return to Canada, even temporarily, you may file bankruptcy, or perhaps a consumer proposal to deal with your debts. You can read up on consumer proposals here: Consumer Proposal: Debt Negotiation and Settlement with a Consumer Proposal (http://www.moneyproblems.ca/consumer-proposals.htm)

Good luck.

I have a few questions about debt/collection laws and statue of limitations in Ontario.
I have a debt load of just under $14,000 (Citifinancial is the company which holds my debts).
At present, I am working and living in S. Korea as an English teacher.
In June of 2007, the private school I was working for closed and it took me some time to find a new job. Shortly after this, in August of 2007, I was hospitalized after being hit by a motorcycle. During this time, the last thing on my mind was my debts.
Of course, Citi was calling my house in Canada (where I no longer live), sending me letters there and in some cases asking my parents to pay off my debts for me. I had my parents, my (new employer) and my doctors write letters and explain what was happening, but Citifinancial didn't respond to the letters. I don't know *why* Citi is being so unreasonable with this, but the fact is, they are.
I never had any intention of ducking out of the debt I owe, but now after speaking to a collection agency hired on behalf of Citifinancial, they are demanding the full amount I owe them ($9000+). I've tried negotiating a settlement with them, and I was told that I "could probably pay $6500" and have it closed out (that's a direct quote). Seeing as I don't have $6500 either, this is not an option for me.
I've had discussions with two credit counseling services, but the fee they are asking for is also too high for me to manage (one was asking for $1200/mnth, the other $1100/mnth)
I understand that I can not legally start bankruptcy proceedings, as I'm not in Canada at present.
So, here are my questions.
1). I've not made any payment to these companies in almost a year (I'm sure it's over a year). I've read somewhere that there is a two year statue of limitations for debt in Canada. I've also read there is a 7 year S.O.L. Is either of that true?
2). Can a company somehow start a legal proceeding against me while I'm in a foreign country?
3). If they can, how could I go about defending myself from Korea? I've read that if legal proceedings are started against an individual and that person doesn't respond to the court, then a judgment is automatically found against that person. Is that true?
4). Would a judgment/legal proceedings/debt issues prevent me from entering Canada in the future? I'm planning on being in Korea for (at minimum) another year, but I would hate for any of this to stop me from being able to come home at Christmas or on vacation.
I'm really at a loss as to how to handle this. Like I said initially, I don't want to duck my responsibilities here, but at the same time, Citi is being quite unreasonable (in my opinion) and I'm really stuck between a rock and a hard place.
Any and all help would be greatly appreciated!

Paul
Statute of Limitations is 2 years for a debt created or last acknowledged by payment or in writing after January 1, 2004. To prevent the limitation period from expiring while you are overseas, they would have to sue you in abstentia. You may read the Limitation Act by going to www.e-laws.gov.on.ca and reading the stuatute. If you "google" limitations act in ontario, there are several good hits.

What a stautute of limitations provides is a consistent time that every creditor has before they can no longer use the Court to collect the debt. So DebtExpert is correct in that the debt never goes away. However, if you cannot sue or convince the debtor to reaffirm the debt, the collectability of the debt is gone.

There is a six year reporting window at credit bureaus... six years from when the debt was originally written off. The combination of the 2 year limitation period and the six year reporting period means that the debt will eventually be gone from sight.