Tell us, in a few words, for those who are not yet familiar, what the Second Chance Law consists of.
To understand the context of the Second Chance Law, we must take as a starting point article 1911 of the Civil Code, which establishes that an individual must respond with all their assets (present and future) against any debt acquired and that has not legally disappeared. .
The Legal Institute, known as Second Chance, is a bankruptcy instrument that allows this liability for debts to be broken and refers to a debtor being able to obtain the forgiveness of outstanding debts. The aforementioned expression also refers to the fact that the debtor who has not been able to satisfy all his debt with his patrimony at a certain moment can start his activities again and the possible constitution of a new patrimony that is not affected by the debts. old dissatisfied
Therefore, in summary, the objective is none other than to allow, as indicated by its name: that a person, despite an economic, business or personal failure, as long as he complies with the standards of bankruptcy good faith, has the possibility of get your life back on track, and that includes taking the risk of new initiatives, without having to drag around a slab of debt that you can never pay off.
Do you think that second chance mechanisms are already well known?
Absolutely no. In recent years, despite the fact that efforts have been made to try to spread the procedure known as Second Chance, statistics and studies tell us that people are still unaware. The Barcelona Bar Association has done a very remarkable job, but at the state level it remains unknown.
What would you highlight about the changes applied to the Second Chance Law?
In the first place, I would point out that there is an absolute change of the system that was contemplated in the previous regulation. It is not just a mere tweak, but a substantial change that ends with a system that has generated a lot of legal uncertainty.
One of the main novelties is that the debtor can obtain the exoneration without having to liquidate his assets, which greatly protects the debtor.
In addition, the early declaration with active mass, which results in a greater satisfaction of the interests of creditors. In exchange, the debtor avoids the closing of the company, can keep the jobs and the foreclosure that weighs on the house, in the event that it has one.
Also, certain procedures are eliminated, such as the obligation to have attempted an out-of-court payment agreement. The exoneration is extended to all bankruptcy debts and against the estate. The behavior of the debtor is also valued to avoid situations of abuse. With the new requirements, they are tempered by the reversal of the burden of proof. Finally, the treatment of public credit is modified, something that from Saldados we consider is not acceptable and delimits the entire system.
What are the benefits for new users?
The 2022 reform configures a much more efficient procedure by expanding the list of exonerable debts, the possibility of exoneration without prior liquidation of the debtor's assets and with a payment plan. In this way, the user is allowed to keep his home and his business assets.
The new system is based on the exemption based on merit, which means that any debtor, whether he is an entrepreneur or not, as long as he meets the standard of good faith, can discharge all his debts, except those that exceptionally and of a special nature are considered legally non-exemptible.
How long can a process take to reach the exoneration of debts?
Although it is true that the intention of the legislator has been to limit as much as possible the time of the deadlines in bankruptcy matters, the reality is that a specific date cannot be established.
Each procedure will depend on its casuistry. Based on the experience of Saldados and taking into account the latest exoneration resolutions that we have obtained, we could talk between five and seven months. But everything will depend, as I have commented, on each case.
What advantages does Saldados offer compared to other law firms?
Saldados is a legaltech focused on the Second Chance Law that provides legal services from start to finish, until our client obtains the exoneration. What we have achieved and what makes us feel most proud is maintaining the personal relationship with our client, streamlining and digitizing the process from start to finish. This entails a substantial cost reduction that impacts our client. Today, we have rates that no other law firm or platform can offer, since we reduce costs by around half. This is because we have a top-level professional legal service, we have a service that can help you 24 hours a day, but digitizing lowers costs.
