Family Business Loan - Signed Promissory Note - SD Failed - Now a Claimform

[steampowered]

Well its been over a week since we wrote and i know they had the letter as we sent it recorded. And yet they have so far not replied nor acknowledged our letter we are very concerned that they have not replied, if they start court action how can we check are their any web site listing up and coming courts action cases, as sitting waiting for a letter of action is now stressing us both out.

Unfortunately not. All you can do is contact the nearest county court. However they would have to start proceedings by issuing you with a claim form so you should know about it.

 

We were told if it went to court and lost they can instruct a high court sheriff to collect on the same day, and if we did not pay they can take our belongings even the 12 year old car this this correct ??????

 

Any feedback would be great

No, the value of this claim is such that it would be dealt with in county court. If they won they could instruct bailiffs but that takes time - county court bailiffs take some time to do anything; and if they wanted to instruct a high court enforcement officer the judgment would have to be transferred up to the high court first. They couldn't do anything on the same day and declaring bankruptcy if you lost in court would protect you from bailiff enforcement.

[rippedoff15]

Hi All,

 

Well they have confirmed they had our letter,

however they are still claiming as we signed the promissory note - this in legal terms means its a personal loan and not a business loan.

 

 

they also state we were not pressurised into signing the note.

state we have 7 days to repay in full or make a repayment offer.

have noted my own Bankruptcy and state the debt belongs to my wife.

 

My wife has now been given a bankruptcy date of the 16th March 2015

and this debt is included, which should bring closer.

 

 

I will try to scan the full letter tonight if anyone can help it would be great

 

Regards

[steampowered]

That is helpful because we now know where you stand - i.e. they are considering a claim against your wife only and not against you.

 

I remain of the view that your wife is not legally bound by the promissory note as she did not provide any consideration for it. This is basic contract law which should defeat any claim based on a document which was not signed as a deed. For this reason I think it is unnecessary for your wife to declare bankruptcy just because of the promissory note, unless she gets to court and the judge decides that she is liable.

 

Of course if she has a 40k debt from an old mortgage which she can't pay then perhaps that is a good enough reason to declare bankruptcy by itself. Just make sure you and her understand the implications of bankruptcy - it sounds like you are already familiar.

[steampowered]

Well, if it is true that your company was actually insolvent and a receiver had been appointed when the loan was made, at that time you no longer had any authority to borrow money on behalf of the company and I suspect that taking the loan for the company would have been a minor criminal offence along the lines of wrongful trading. That would badly damage any argument you might wish to make that the loan was made to the company rather than individuals.

 

It is interesting that they do not appear to be actually relying the promissory note as founding the claim. Rather, they are trying to use it as evidence of what happened previously. I think this is a bit tenuous to be honest as a document signed later cannot change the original underlying facts.

 

I think you are left with arguing that the original loan was made to you and not to your wife, but was discharged by your bankruptcy.

[rippedoff15]

Bit more information

the loan was paid into the company account before any administrator was appointed about 4 months later.

 

 

They seem to be replying on the promissory note as proof.

 

I have wrote to the solicitors stating the our point of view, had no reply as yet.

[SabreSheep]

I will say it again

 

STOP TALKING TO THEIR SOLICITORS

 

All the time you are talking to them you are allowing them to bully you. All the time you are giving them points you are enforcing the belief that they can bully you and giving them an idea on what cards you would play if it went to court.

 

IT IS FOR THE COURT TO DECIDE WHETHER YOU OWE THIS MONEY OR NOT.

 

Stop playing letter tennis and tell them to issue the claim. Then people here can help you with your defense. *IF* you lose you can then go for bankruptcy

 

Put the ball in their court. Send one final letter stating "No debt recognised to your company or client, no further correspondance shall be entered into. Any legal action shall be vigorously defended.

 

END OFF

 

at that point their only choices will be

 

1) Let it drop

2) Sell it to a debt collector (That will have no more powers than them and would have to take it to court just like they have to.

3) Issue a claim

4) Harass you further for which YOU can take legal action to make them stop.

 

All the time you are playing letter tennis with them, I do nto feel there is any more advice anyone can give you.

[BazzaS]

The OP hasn't really followed the advice (don't pay, deal in writing only) since early 2014, and probably since the thread started in 2009 (advice : don't sign promissory note, debt dealt with by company insolvency) ......

What makes anyone think they'll start now?

 

CAG is a self-help site. The OP is going to have to start helping themself rather than keeping posting without helping themself, if they want to change the status quo.

 

Is there likely any impact on a court's assesment from "why would they have paid for so many years if they didn't intend repayment when they signed the promissory note"?

[rippedoff15]

Well its been months since we wrote and so far they have not replied,

 

 

however this week the family member visited bringing their 18 year old son as well.

 

 

We were shocked when the grandson has now started asking for the will to be changed this has shocked us totally.

This has also upset my wife`s mother and feels by getting the grandson to get involved is completely underhand.

 

 

Again we have wrote stating our case but they and their solicitor are not replying.

The family member only visits once a year and only to add pressure to get a will changed.

 

Now we feel like reporting them to HMRC as we witnessed them banking customers cheque payments to their son`s bank account and not putting the sales through the till, as they stated they need to send him to private schooling.

But is it worth starting a war !!!!!!

[f16]

 

Now we feel like reporting them to HMRC as we witnessed them banking customers cheque payments to their son`s bank account and not putting the sales through the till, as they stated they need to send him to private schooling. But is it worth starting a war !!!!!!

 

Sounds like the "War" has started !!!!!!!!!!!!

 

I would report it . ............. Might just give them something else to think about . HMRC will start "digging" and trust me won't stop.

What goes around comes around !!!!

 

As steampowered said "It's not gone legal yet"

[SabreSheep]

Change a will?

 

This sounds likes harrassment.

 

One letter recorded delivery to them stating all contact is to be in writing only. No visits without a prearranged appointment with you in writing of which you have no intentions at this time of making one.

 

State that any visits from them or anyone acting on their behalf will be treated as harassment and the police will be called.

[rippedoff15]

With regard to a change of will,

my mother in law who is fit as a fiddle,

has made a will a few years ago - her house is left between the 4 children.

 

 

Therefore my wife`s sister who is the family member keeps asking for the will to be changed removing my wife completely.

 

 

I myself was declared bankrupt and it was included

they claim its now my wife`s debt thus they keep chasing her.

 

 

They visit once a year trying to get the will changed and now the grandson is also getting involved.

[f16]

In fact. .............. Bearing in mind this started on 07 / 09 / 09 .

With 8 % interest (was that noted in the "promissory note" ) Contract ???????????????

 

Now you find they are evading Tax (your words).

Try Fraud line !!!

[rippedoff15]

Hi this is the promissary which was signed word for word,

it is not signed as a deed,

 

 

They have now stated the debt is as follows:

 

loan £20,k

Repaid to date £12,750

 

Outstanding including charges £23,585.01

 

After a chat with my mother in-law she has refused to change her will and told them to stop asking,

they have also stated i myself have been sending rude emails, which is strange as the last email was sent on 12/12/2014 and i have got copies of every message sent and the only way we detail with this is in writing.

 

 

They have stated have taken out a loan for £100k in 2008 which is their business not mine but they informed me the interest of 8% covers all the loan interest and why should they pay it when it should be me !!

 

They have said they will not stop chasing this debt until it is repaid with interest !!!!!!

However we have noticed to the promissary note their are not time-scales nor how much should be repaid each month

 

Signed Promissory Note

 

As of 1st August 2009 we, Mr & Mrs both of address jointly and severally promise to pay ( their names ) both of their address on demand the sum of £21,114.00 with interest at the rate of 8% per annum.

 

We further promise that we will keep regularly updated as to any changes in our financial circumstances between the date hereof and payment of said sum with interest as hereinbefore provide for.

 

signed and witnessed

[ibberty bibberty]

See my post #75, which confirms that your wife is liable for the sum claimed.

 

In my opinion, based upon the facts you have posted here and the law and the authorities thereon, your wife has no grounds to either challenge or defeat that which she expressly promised to honour.

 

ibberty bibberty

[steampowered]

In this case, the money was advanced a considerable period before the promissory note was signed. I personally do not think there is consideration for the note, as this would be an example of 'past consideration' - see https://en.wikipedia.org/wiki/Consideration_in_English_law#Past_conduct/

 

The money was also advanced to the husband (before his bankruptcy) rather than his wife, I'm not sure what the consideration would be for the wife agreeing to guarantee her husband's debt after the loan was made.

[steampowered]

My understanding is that promissory estoppel can only be used 'as a shield' and not 'as a sword'. I think this means that promissory estoppel could be raised by either party as a defence to legal proceedings; but it could not be used by the other side as the basis for bringing a claim against the wife.

 

Personally I am also struggling to see the 'change in position', which is another requirement for promissory estoppel. The money had been advanced to the husband and dispute arisen about payment before the wife signed the promissory note, so I don't think the other side could be said to have changed their position in reliance on the promissory note.

 

See https://en.wikipedia.org/wiki/Estoppel_in_English_law#Promissory_estoppel_.28contract_law.29. 'Promissory estoppel requires (1) an unequivocal promise by words or conduct, (2) a change in position of the promisee as a result of the promise (not necessarily to their detriment), (3) inequity if the promisor were to go back on the promise. Estoppel is "a shield not a sword" – it cannot be used as the basis of an action on its own. It also does not extinguish rights'

[steampowered]

Without wishing to turn this thread into a legal debate, I think we will have to agree to disagree on this. My perspective is that the conventional view in the legal profession remains that promissory estoppel can only ever be a shield. The situation is different for proprietary estoppel but that is quite a different beast and of no relevance here.

 

The cases you mention were all decided in the 1970s in the days when Lord Denning was trying to push the envelope. They have since had some pretty negative judicial treatment. The Evenden case was overruled in 1979 in Secretary of State for Employment v Globe Elastic Thread Co Ltd and is no longer good law. Re Wyvern is good law but covers a very specific situation of liquidators who are held to especially high standards of conduct. In any event, the cases you mention concern an employer from denying something rather than creating a claim on its face.

 

I am not aware of any reported case in which a party successfully used promissory estoppel to create a basis for a claim. On the other hand there have been plenty of recent cases where claims have failed for lack of consideration; all of which would have been decided quite differently if promissory estoppel were readily available to create claims.

[rippedoff15]

Well its that time of the year again

we are now getting calls requesting payments,

 

 

they are contacting my mother-in law and asking about the debt which now stands over £30k interest being added every day.

 

 

We wrote in Jan 2015 refusing their demands and the amount which they are claiming.

Not had any letters from their solicitor since my reply in fact not had any contact until today.

 

 

So not sure what their next move will be after all if their were going to take out court action why have they not do so already seems strange.

 

Will post any updates as they happen

[rippedoff15]

- We have had a letter from xxx LLP demanding over £20k relating to this long standing issue,

We have been asked to contact xxx Practice Manager with a view to repayment of the outstanding amount.

 

How can we sort this issue out once and for all to bring this to a close.

 

My question is if they start legal action after 21 days what happens next ?

Should we file for BR

 

Any help would be great

[rippedoff15]

Sorry the letter which we have been sent is from

 

[removed] which is small cottage, strange address for a solicitor, i have looked on the web and xxx are based in London

Edited May 5, 2016 by honeybee13
Names removed.

[rippedoff15]

Yep,

the wonders of the internet after digging around I have found out the letter is not from solicitor but an ex solicitor who was charged with 5 counts of fraud.

 

 

Letter states a legal company who are based in London but this letter is from different address totally.

 

I think they are trying to frighten myself and my wife but clearly we are not stupid enough to roll over.

[steampowered]

rippedoff15 said:

We have had a letter from xxx LLP demanding over £20k relating to this long standing issue, We have been asked to contact xxx Practice Manager with a view to repayment of the outstanding amount.

 

How can we sort this issue out once and for all to bring this to a close.

 

My question is if they start legal action after 21 days what happens next ?

 

Assuming you do not intend to pay, the appropriate response would be to write a short letter back saying that you do not believe any debt is owed and briefly explaining why, and stating that accordingly you will not be making any payment. Refer to post number 25 in this thread.

 

It will then be up to them whether to initiate legal proceedings or not. If they do issue proceedings, you will have the opportunity to file a defence on the basis explained earlier in this thread.

 

Quote

Should we file for BR

Have a read back through the thread. Personally, I don't see what point there would be in declaring BR unless the claimant is able to win court proceedings.

[rippedoff15]

Well been digging deep into this company,

the letter which we have been sent is clearly not from the firm based in London

it has the same name but different address even the web site on the letter is wrong and the website stated has never been listed. i was going to purchase it tonight myself.

 

It would be very interesting to see if the London based company which is also dormant according to companies house is aware this guy is using their name sounds like this is a fraud which has already been confirmed in court.

 

Going to write back and see what happens next,

[rippedoff15]

I do smell a rat here,

maybe send the SAR to this guy claiming to be their new solicitor to the address on the letter and send SAR to the London office as well. If i send the SAR do they have to all details they hold on record.

 

Considering they used a solicitor who was a genuine solicitor it seems strange they are moving in a different direction. I think the solicitor from last year may have said they would not have a good case thus they are using the new guy.

[BazzaS]

You could ask for a subject access request and see what they say..

 

SAR a solicitor?

 

Strange advice!.

Either you want your own file from your own solicitor : in which case just ask for it, or you want someone else's file from their solicitor (or at least the bits mentioning you), where they will decline based on legal advice (and/or litigation) privilege!

 

The information wouldn't be disclosable even if there was a court case ongoing with disclosure of documents required (being witheld under CPR 3.19(3)), so an SAR on a solicitor acting legitimately will achieve nothing!