I am writing regarding non-payment of a 5,000 loan that I made to a friend in Aug. '08.I am considering taking this to small claims court and have a few questions before I do this.The last payment I received was a check dated 4/25/12 tha ...

Submitted by MLeslieQ on

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I am writing regarding non-payment of a 5,000 loan that I made to a friend in Aug. '08. I am considering taking this to small claims court and have a few questions before I do this. The last payment I received was a check dated 4/25/12 that included a memo stating that the amount was for March, April and May. I have been advised not to accept this check since it doesn't take into account the amount that is in arrears, $3183. I have asked for a replacement but was denied. There is written contract between the parties; however, due to unforeseen circumstances, it was never signed. Will either of these documents affect a decision in small claims court? Also, I live abroad and am not sure if I can stay in the states until the date of the hearing. Would I be able to appoint someone non-professionally, e.g. a friend as my legal representative in my absence? I appreciate any advice you can give me. Michelle L. Quitman

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DakotaLegal's picture

It’s a good idea that you are

Submitted by DakotaLegal on

It’s a good idea that you are about to get into a Florida small claims court. As a general rule, especially when the clock is running and many months have gone by, start a court case so you don’t lose all your rights by waiting too long. Most states have a two year limit on filing for a contract debt. Here, it looks as though your loan is much older than two years. In this case, your argument is going to be that you had an agreement in place since 2008, and that once your friend recently stopped paying completely (or that you no longer agreed how to be paid), you are suing for the amount due ($3,183).

Small claims is the right place to begin in Florida if the amount you are suing for is under $5,000. Once you file, Florida also requires mediation, which might be better than you trying to reach an agreement on your own.

Without a signed contract, you’ll have to do a very good job of presenting evidence. Without a signed contract, at the least you probably won’t be able to use the contract to prove complete agreement about all the terms of the contract (for example, if there were supposed to be late payments or interest). Depending on the judge, they may look at some or none of the contract. Be ready for this, and know that you still have a contract, even if it’s “only” verbal. You will prove that their behavior, or performance, showed the contract.

But don’t tell your friend (or the mediator) or challenge them on any weakness in your case because of these facts. Be confident you are right. You might also keep a log or calendar, and copies of any letters, where you refer causally to the contract, and hopefully they will either admit they had agreed to the contract or at least not bother denying it. Small claims courts are usually more lenient on hearing evidence, if both sides are representing themselves…think “People’s Court” here. But because of their workload, they also ask for copies to be attached to the complaint. Make sure the materials you submit are very well organized and simple: attach a cover sheet making “bullet” points.

Having good evidence can be also be even more complicated by the type of friendship you had, too. For example, did you a make the loan because you were in business together, were sharing a residence or even bank accounts where you mixed money together, or had some verbal agreement that other records could prove (utilities or statements or checks?). If you can get copies of the other payments, good. Are there e-mails showing they intended to pay? If there are not checks from them, at least have copies of cash deposits in the amounts you have been paid.

Plan on the worst, too. The person may claim to have paid you more than they did. They will probably say it was a gift, or that they said only they’d pay you “if I can.” Have a simple answer---you can especially rebut this point especially well if they at any time they were paying consistently.

Florida’s small claims courts (unlike many other states) actually let you have a lawyer represent you. The court prefers to have you there yourself, and in this case, because of the unknowns (specifics of the contract, time of the breach, was it a gift?), it really makes sense for you to be there yourself.

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DakotaLegal's picture

It’s a good idea that you are

Submitted by DakotaLegal on

It’s a good idea that you are about to get into a Florida small claims court. As a general rule, especially when the clock is running and many months have gone by, start a court case so you don’t lose all your rights by waiting too long. Most states have a two year limit on filing for a contract debt. Here, it looks as though your loan is much older than two years. In this case, your argument is going to be that you had an agreement in place since 2008, and that once your friend recently stopped paying completely (or that you no longer agreed how to be paid), you are suing for the amount due ($3,183).

Small claims is the right place to begin in Florida if the amount you are suing for is under $5,000. Once you file, Florida also requires mediation, which might be better than you trying to reach an agreement on your own.

Without a signed contract, you’ll have to do a very good job of presenting evidence. Without a signed contract, at the least you probably won’t be able to use the contract to prove complete agreement about all the terms of the contract (for example, if there were supposed to be late payments or interest). Depending on the judge, they may look at some or none of the contract. Be ready for this, and know that you still have a contract, even if it’s “only” verbal. You will prove that their behavior, or performance, showed the contract.

But don’t tell your friend (or the mediator) or challenge them on any weakness in your case because of these facts. Be confident you are right. You might also keep a log or calendar, and copies of any letters, where you refer causally to the contract, and hopefully they will either admit they had agreed to the contract or at least not bother denying it. Small claims courts are usually more lenient on hearing evidence, if both sides are representing themselves…think “People’s Court” here. But because of their workload, they also ask for copies to be attached to the complaint. Make sure the materials you submit are very well organized and simple: attach a cover sheet making “bullet” points.

Having good evidence can be also be even more complicated by the type of friendship you had, too. For example, did you a make the loan because you were in business together, were sharing a residence or even bank accounts where you mixed money together, or had some verbal agreement that other records could prove (utilities or statements or checks?). If you can get copies of the other payments, good. Are there e-mails showing they intended to pay? If there are not checks from them, at least have copies of cash deposits in the amounts you have been paid.

Plan on the worst, too. The person may claim to have paid you more than they did. They will probably say it was a gift, or that they said only they’d pay you “if I can.” Have a simple answer---you can especially rebut this point especially well if they at any time they were paying consistently.

Florida’s small claims courts (unlike many other states) actually let you have a lawyer represent you. The court prefers to have you there yourself, and in this case, because of the unknowns (specifics of the contract, time of the breach, was it a gift?), it really makes sense for you to be there yourself.