Long one…

I have worked for the same company for 16 years

about 10 years ago I needed to borrow about £10k.

I also borrowed other bits over the 3 years after but nothing since then.

I had a good relationship with my employer and I was paying it back at about £100-150 a month.

No interest on the loan.

Think the total amount was £15k.

There was never an agreement and I signed nothing nor did I ever enquire about the amount still owed, money was just deducted from my wages.

In the middle of last year my employer died and the company was sold to another guy who has transformed the business, I didn’t really fit in after the changes so decided to leave last week.

I had a call this week from the new MD saying I owed the company £14k and he wants It back straightaway or very soon after I leave.

We did have a conversation about this money back in October and he said in the handover from my previous employer no history was supplied to what I had borrowed or paid back and that this amount was on the balance sheet with my name attached.

He agreed to go and find all the info.

Heard nothing more until this week when I handed my notice in.

Currently I have 5 CCJ’s, no money and have no way of raising this money quickly.

On the phone he was aggressive said I had 48 hours to come up with a plan.

I asked if he managed to get the info I asked for previously and he said he had plus he has an email saying I agreed to pay £350 a month back in 2014.

I never paid more than £150 a month.

He hasn’t supplied me with any of this extra info and with his aggressive manner it makes me believe he may be bluffing.

I would like to see a full breakdown to see if the amount is correct in the first place that I owe.

Without that how liable am I for this debt?

Any ideas on how to proceed?

I know its a strange one but you guys here have helped me immensely over the years with my debt problems.

I have a new job starting in March but won’t be earning much more money its just a nicer working environment.

without any form of signed or implied agreement

I think he'd be up the creek.

dx

Thats what I thought. He said he wanted to get in and formalise it quickly, I bet he does. I am going to ask him for the financial statements and see what he has. It doesn't even show on my wage slips, the slips say one amount and I was just paid less in my bank.

I mean I feel bad as the company lent me it in good faith but on the other hand I never got commission on what I did or received a pay rise for nearly 6 years.

I gather that you borrowed money from your employer and there doesn't seem to have been a formal repayment agreement – although there may be some email where you undertook to repay £350 per month.

Despite this, I understand that you have been repaying a much smaller amount – maybe up to £150 per month and that as far as you understand, there was no provision for any interest repayment.

If you can show that there were regular repayments of a regular sum and these repayments were made over an extended period of time – say a number of years, then I think that it will be possible to say that despite the absence of any written agreement – and even despite the alleged email of 2014, that the agreed repayment terms were the ones which actually happened and which were accepted by your old employer.

If that is the case then I think that this would be the position to argue from in the event that a legal action is brought against you.

I think you need to let us know more detail.

I think you need to let us know exactly how much was borrowed – giving us a chronology of the loan amounts and the dates.

Exactly how much has been paid back – giving a chronology of the repayments and the dates.

How much do you think remains to be paid? And why does your new employer think that you owe £14,000?

Have you got all your paperwork? If not, then you need to get all your bank statements and any other information which shows your borrowings and your repayments.

Also, I think you need to do an SAR to your employer to obtain all the information they have on you on any matter – but especially this issue.

In the meantime, start reading up about estoppel because in the event that your new employer decides to bring a claim against you then I would suggest that you run an estoppel by way of a defence.

When you supply us with the additional information I have asked for and laid out in a more methodical way, then we can see how the advice might be modified.

Since your employer died, the business of been taken over by a new employer now requires full repayment very quickly.

Maybe you can confirm that this is all correct.

I think the first thing to do is to work out what exactly the repayment terms were. Although there may have been an email in which you undertook to repay £350 per month, it seems that that has been ignored and that you have been paying much smaller sum.

You seem to be saying that you pay between £100 £150 per month but you don't say how long this has been going on or if it was every month or whether you missed any payments.

I think we need to know this.

I gather that you borrowed money from your employer and there doesn't seem to have been a formal repayment agreement – although there may be some email where you undertook to repay £350 per month. Yes no formal agreement, I paid £100 for quite a few years and then £150 from 2014 I believe. I have no paperwork.

Despite this, I understand that you have been repaying a much smaller amount – maybe up to £150 per month and that as far as you understand, there was no provision for any interest repayment. Yes no interest.

If you can show that there were regular repayments of a regular sum and these repayments were made over an extended period of time – say a number of years, then I think that it will be possible to say that despite the absence of any written agreement – and even despite the alleged email of 2014, that the agreed repayment terms were the ones which actually happened and which were accepted by your old employer. I have wage slips and payments into my bank that differ.

If that is the case then I think that this would be the position to argue from in the event that a legal action is brought against you.

I think you need to let us know more detail.

I think you need to let us know exactly how much was borrowed – giving us a chronology of the loan amounts and the dates. I don't know this, all our emails prior to 2013 were deleted on the server after a virus. It was around 2007 I think and I don't know the actual amount borrowed.

Exactly how much has been paid back – giving a chronology of the repayments and the dates. Again I have no exact dates. I think I started paying £100 a month in 2007 and then £150 from 2014

How much do you think remains to be paid? And why does your new employer think that you owe £14,000? Apparently £14k is what was on the balance sheet when the new guy bought the company, in October he said he had no financial information relating to it. He now says he does but I have not seen it.

Have you got all your paperwork? If not, then you need to get all your bank statements and any other information which shows your borrowings and your repayments. I only have paperwork for the last couple of years or so.

Also, I think you need to do an SAR to your employer to obtain all the information they have on you on any matter – but especially this issue.

In the meantime, start reading up about estoppel because in the event that your new employer decides to bring a claim against you then I would suggest that you run an estoppel by way of a defence.

When you supply us with the additional information I have asked for and laid out in a more methodical way, then we can see how the advice might be modified.

Since your employer died, the business of been taken over by a new employer now requires full repayment quickly.

Maybe you can confirm that this is all correct. Correct

I think the first thing to do is to work out what exactly the repayment terms were. Although there may have been an email in which you undertook to repay £350 per month, it seems that that has been ignored and that you have been paying much smaller sum. Well I remember a discussion but my employer said in a conversation that I wouldn't be able to afford it so he took £150 instead.

You seem to be saying that you pay between £100 £150 per month but you don't say how long this has been going on or if it was every month or whether you missed any payments.Never missed a payment as it was taken from my wages at source. I think its been paid for about 10 years. I only have memory to go on

I think we need to know this.

I'll have to respond tomorrow, but in the meantime I hope you won't mind me saying but it would be more helpful if you would simply give your replies in a narrative without repeating my own questions at me. Thank you

by the way i realise that i have forgotten to let you know that my opinion is that you definitely have a liability to repay the money. It is just a question of working out how much and at what rate.

I agree. It needs to be affordable but that will take years. Offering a charge on my house plus an affordable amount?

No

Ok

How long do you think is acceptable to pay off this debt?

Consider it from the new owner's point,

£15k at £100/month with no interest was rather slow

but now you have resigned there is no imperative for him to continue this arrangement so of course they want some arrangment in place to ensure that you pay it back in a more reasonable time.

The debt is real, you have admitted this by your actions so you wont be getting it cancelled just because there isnt much paperwork to formalise it so start to deal with the realities.

Part of that is you have 5 CCJ's so not exactly someone whose word is their bond.

However the new boss has to deal with that reality as well and expecting you to somehow pay the lot off in a month is equally unrealistic.

If you have been paying £150/month for some time then that is a realistic starting point for negotiations but dont expect to pay less than this,

he would be better off paying the court fees and going after you big time should you start to make noises about how poor you are etc and can ony afford a pittance so do your sums,

find out what the balance is,

dont agree to interest being added ( that will cause all sorts of new problems for both of you) and make an offer in writing that you can stick to as you will be paying this for a long time.

But surely based on the numbers above, although exact dates are not given:-

£100/month=£1200/year, from 2007-2013(7 years approx.) = £8400 repaid

£150/month=£1800/year from 2014-2016(3 year approx.) = £5400 repaid

Total repaid approx. £13800. If only £15k was borrowed surely only £1-2k is left to repay if no interest was being charged.

Part of that is you have 5 CCJ's so not exactly someone whose word is their bond.

I'll start off by saying that this comment is extremely unhelpful. Thousands of people come to this forum and have terrible debt problems which many of the rest of us will never understand, but they come to us to help and this forum exists to do precisely that – and not to sit in judgement.

But surely based on the numbers above, although exact dates are not given:-

 

 

£100/month=£1200/year, from 2007-2013(7 years approx.) = £8400 repaid

£150/month=£1800/year from 2014-2016(3 year approx.) = £5400 repaid

 

 

Total repaid approx. £13800. If only £15k was borrowed surely only £1-2k is left to repay if no interest was being charged.

Yes, these are the important questions which need to be asked.

The OP says that he has had repayments deducted directly from his wages and so there needs to be evidence of this.

I think we need to know full details from the OP as to exactly what evidence he has got, and also he needs to serve an SAR on the company in order to get all the old wage slips.

At the same time – as a belt and braces approach – he needs do approach the tax authorities and see what back information he can get about his wages from them.

With these kind of records, it can't be too difficult to put together a pretty good picture of what has been repaid over the years.

This will give us a good idea, first of all of how much is still owing and secondly what was repaid each time and how long it has gone on for.

The aim of this is to be able to point at the history of this and to say that all the evidence shows that there was an agreement to repay the money at £XXX per month – and also there is now only £XXX remaining.

One piece of advice I must give to the OP is that he must keep on making the instalment payments without failure.

If there is any interruption in the repayments, then the new boss will be able to say that he has gone back on the agreement and he must now repay all at one go. However, I don't see anything which would allow the new boss to go back and recover all of the £14,000.

If you have got evidence that the instalment payments were made, then they will have to be deducted from the original figure and so the best that the new employer can hope for is to recover the outstanding balance.

We will have to figure out if any kind of interest might be due. But we will only really understand that when we see as much of the history of this debt as possible.

I'm a bit concerned because the OP doesn't seem to be very proactive on this issue – but it is essential.

As far as making an agreement to repay and putting a charge on your property, this is a crazy idea – and absolutely not necessary unless you start defaulting on the repayments. If you do that, then you are opening up a can of worms.

Yes Bankfodder comments like that are unhelpful. My debt problems are on this site and without this site I would not have had the strength to fight and be in the better place I am now. After years of sticking within my means we lost our business due to the 2008 recession and simultaneous diagnosis of my partners breast cancer. Suddenly we were without money to feed the family/pay an employee once the reserves ran out. Debt quickly became the only issue to survive at that time, not a choice I wanted nor thought about much at the time. Took along time to get sorted but I'm grateful to this place.

I just had another call from my boss and had a chat about the issue. He is going to supply me with the info and I also said that the most I can afford will be £150 a month to start with. I said that with my new job there is going to be the opportunity to progress and earn more money so ramping up the repayments as I can afford them will be an option to me and he seemed happy at that. I said I will put a plan in place based on my affordability.

Well I'm pleased that there seems to be some kind of dialogue between you and your new boss.

However, I would counsel you to be extremely careful. I have no idea why you are doing things on the telephone – especially as I suspect that you're not recording calls – even though you've been here since 2013 you should know better.

With kinds of problems that you have been finding yourself in, you should by now have developed a more cautious instinct.

Nothing agreed on the telephone can be relied upon and at the very least you need to have evidence of your discussions.

A particularly sticky issue is the question of how much are still outstanding. Have you address that? Does your new boss agree that it is likely that you have paid off a substantial part of this debt?

Have you agreed on the outstanding figure?

Have you agreed on the question of interest?

If none of these matters been mentioned then I think that you are still in a difficult position.

I would start off by installing a call recorder – as you should have done so already. I would also follow up conversations with nice polite friendly letters saying that you were pleased to speak to him – blah blah blah and you look forward to receiving blah blah information – because as you said in your telephone conversation blah blah, you have been paying back between £XX and £XX for 10 years blah blah, and you are pleased to hear that he appreciates that that is probably the case.

You also look forward to further discussions with him to make a formal agreement as to the outstanding amount and as to the rate of instalments to be made based on your present position.

Et cetera et cetera blah blah blah.

If you don't get all this sorted out and have it in writing, then you could find yourself in problems later on.

you take the comment out of context, my next line says "however, the new boss has to deal with that reality....."

The poit of mentioning something raised by the OP and that can be found in the public domain was that the new boss would be unlikely to continue with an informal arrangement, hence the continuation of my advice.

If my comment is "extremely unhelpful" then please quantify or qualify that statement. I accept that its relevance will depend upon the standpoint of the person reading it and it was not meant to belittle or offend but was meant to show that the new boss's acceptance of a repayment plan may well be dependant on formalising things based upon what has gone on before and the OP's statements of his current position is part of that and cant be ignored.

It seems as though the new boss is accepting a proposal so he now should get the information about how much was borrowed, is still outstanding etc and enter into an agreement that the new boss's accountant will be happy to write into the books.