Discussion point Essay Example | Topics and Well Written Essays - 250 words - 2

Discussion point - Essay Example The point in this scenario is to make a choice in regard to prioritizing which debt to clear first. Michael needs to understand that it his legal obligation to pay his mother since it was a loan which is legally binding. However, the loan seems to have been unsecured because it was leased and in line with the evidently missing Personal Property Security Act (PPSA). There are two critical legal concepts that Michael need to understand in regard to his mother. It is not indicated if they perfected any collateral towards the loan and this means that in the event he could not raise the loan, the mother cannot claim anything. However, considering the case of Golf, in the event that Michael failed to honor his lease obligation, VW would repossess the Golf. In an attempt to avoid bankruptcy from the debts including the loan he owes the mother, Michael has Bankruptcy and Insolvency Act at his disposal in which he can make a proposal of paying only a portion of the debts e.g. paying back 50 c ents for every dollar