Making a claim against an ex-friend on sum of unpaid 'loan' - ** WON **

[wrecked]

Hi Everyone,

 

Most of us are always at the receiving end, so this is something different.

 

I need some help and advice please as I am having to make a claim against an ex-friend.

 

My then "Close" friend was in dire straits and I lent him quite a substantial amount of money in 2006. How stupid did that turn out to be. Here is a brief detail.

 

I needed some work done on my car and my friend offered to fix it as he is a mechanic and did a good job. He gave me a price and I paid him. He told me that he was really broke and if I wanted other things done... anything .. like painting, decorating - any job at all, he'd be happy to do them. Basically, he did other work for me and was paid every time. He gave me a price and it was always reasonable. He would do the job and I would pay. Pretty straight forward. But he said he had to pay off a loan and needed some money an I agreed to lend him. He signed a loan agreement confirming that he borrowed the money. He then continued to do work as and when required and as before,I always paid him in full. Then things got bad for me. I became ill etc. and had my own troubles. You can see the threads I started on CAG.

 

Of course i asked my friend to repay the loan, and really any amount would do as now i was so broke. However, as you can guess nothing was repaid. Things got worse and worse for me and all I could do was keep phoning him and request him to repay. Initially he took my calls, and promised to come round and pay me etc. then of course, he stopped taking my calls.

 

My debts got pretty bad and in March I was so close to having my house re-possessed. This case is in my CAG thread. I just managed to save my house. Bottom line was - push came to shove and I just thought - serve him a writ and get it over with. So I did some research and served him a writ of claim through Moneyclaim. As I have written proof that he borrowed the money, it seemed pretty straight forward.

 

However, he had put in a defence stating that he worked for me full time, I had deducted a certain amount every week and therefore the debt had been paid. He then inserted a counter claim stating that I owed him seven weeks wages. Both are lies.

I was quite shocked by the blatant lies.

 

From my research I learnt that I could serve an application for summary judgement using N244 as he has no defence. But I could not do that until after he submitted a defence to my claim.

 

I see from CPR directions that he can basically say anything and make a counter claim. There were no written agreements regarding his work, no wages were given nor deducted, no money was owed from my side. The only written proof of anything is the fact that he borrowed from me.

 

If there were any terms regarding deducting of wage for repayment, these will be in the loan agreement he signed. Clearly thats not the case.

 

The loan agreement basically stated that he borrowed money from me on a date and it gave his name and address. It did not stipulate a repayment date or interest.

 

Can anyone advise on how I can handle his defence and counter claim?

 

Thank you

Wrecked.

[AndyOrch]

Hi Wrecked

 

So have you responded to his defence and CC, you have 14 days in which to do this.If you could perhaps post up your Particulars of Claim (less any identifiable data) and indicate a ball park figure to establish which track this is being processed in.

 

Regards

 

Andy

[wrecked]

Hi Andy

 

Thanks for your very fast response. No I have not replied as I only received it on Wednesday. More specifically, as he had lied through his teeth and made stuff up, it sort of knocked me back. I am having to carefully consider my next move. At the moment, I am researching. Then I thought I would see if I can get any help from CAG.

 

He’s obviously got a solicitor for a client and is getting some help as his reply and counter claim threw me.

 

I was sent Allocation Questionnaire to return for 25 June.

 

I cannot post a copy of my particulars of claim nor his defense and counter claim as the copies are really bad. They do not scan well. They are not so long so I can just reproduce them here - but this will make it a long post though. I hope you do not mind.

 

Particulars of claim.

 

Pounds XXX was borrowed xxx date 2006. I asked the Defendant many times to pay the money back and he agreed to do so, but never did. After Many and repeated requests the Defendant stopped taking my calls. The claim is for PSTG XXX plus interest at 8% per annum from the date in 2006 making the total of the claim to PSTG 2500

 

Loan Agreement

 

I then submitted a copy of the loan agreement which stated

 

This is to confirm that I, xxx of xxx address have borrowed the sum of xxx ( words ) from xxx and (address) on xxx date 2006.This was signed by the Defendant.

 

 

Defense

 

He then submitted his defense by stating that he had repaid this loan as follows

 

The Claimant employed the Defendant as a mechanic, builder and carer for his mother in or around June 2002. The Defendant initially working part time and then full time for the Claimant. The Defendant was paid # xxx per week as wages by the Claimant. On xxx date 2006 the Claimant paid the Defendant the sum of XXXpounds as an advance on the wages. The Claimant and Defendant agreed that the said sum would be repaid by the defendant at xx per week as a deduction from his wages. The Defendant paid the Claimant the said sum back in full in or around sept 2007 There after the Defendant continued to work for the Claimant until or around June 2010 The Defendant does not owe the Claimant the amount Claimed nor the interest paid.

 

The counter claim:

 

The defendant Continued to work for the Claimant until in or around June 2010 and was owed seven weeks wages totaling 2450 and the Defendant claims interest on that sum at 8% per year under 0.69 CCA 1984.

 

(0.69 – this was not legible but that’s what it looked like)

 

Regarding the work, The actual story is

1. He did work for me for some time but was not on wages as he claimed.

2. He did do various jobs over a long period as and when required and was paid for them, always in full.

3. I would never pay anything up front but would always pay something then progressively as the work carried on.

4. he never was a carer for my mother – that’s a fact. I cannot understand why he stuck that in.

5. there was never any agreement to deduct any thing.

6. if an agreement of that nature existed, It would be stipulated in the loan agreement.

7. he signed the loan agreement – so why sign something which did not relate to the agreement you entered.

 

8. Regarding the counterclaim,

 

I did not owe 7 weeks wages. He was not on a wage. That’s just a complete lie.

I have never been late in paying him anything. He’s the type of guy who

a. would not buy anything off his pocket because it was needed to finish the job.

I have to prepay him for any material. If not, then it has to wait.

b. if I am a few pounds short, he’d remind me the next day.

 

 

9. When ever he did work, he wanted everything paid in cash and there were never any written agreements – except for the loan. It was a completely separate issue and one which he never repaid.

 

 

In my opinion, the key issue is the loan agreement. It stated clearly that he borrowed the money. There was no question of repaying over a period by a fixed monthly amount. In fact, at his request, I did not insert a repayment period in the agreement. He told me that he needed the money as he owed income tax to the Inland Revenue and they were after him. He had to pay them immediately.

 

I would prefer to stick with my initial claim and the loan agreement and not be drawn into all the other aspects he introduced.

I think he introduced these to prevent me from making an application for Summary Judgement.

 

As for the counterclaim – it never happened. This is a total lie. He would not do anything unless he gets some money first. Not even after he borrowed money from me!!

 

So really there is no proof. Surely the burden of proof is on him that I owe this money. He must be able to substantiate this. Well, I guess he would just make up some job he supposedly did for which I did not pay.

 

I have records of all my calls to him – there is no single incoming call from him to me on my phone. As I have never owed him money, I do not know what he would do, but since he knows where I live, if I owed him money he could simply come round and ask, or phone me. But he never called me - not even to return my calls.

 

So I am thinking that

 

a. I should proceed with the application for Summary judgement on my claim

b. Deny the counter claim and ask for clear documented proof. (but that’s the obvious move. I would like to come up with some flanker like he did. perhaps I should make up a job he did that went wrong and serve a second writ on bad workmanship)

 

 

 

My sincere apologies for the lengthy reply.

 

thanks again

Wrecked.

[AndyOrch]

Correct Summary judgment for the Defence CPR24, you must make a response to the CC within 14 days that basically its without merit as is his Defence.Give me a nudge if you need to know anymore on the procedures.

 

Andy

[wrecked]

HI Andy

 

Thanks so much for yr fast reply and thanks for your offer of help. That is really great of you. I will draft out a reply to the defence and also Counter Claim and post it for you to comment.

 

All the best/Wrecked

[wrecked]

HI Andy,

 

Thank you again - Please comment on the following

 

 

Summary Judgment Application

N244 – section 3 –

“what order are you asking the court to make and why?”

 

I am asking the Court to give a Summary Judgment against the Defendant on the whole of the claim plus interest as calculated. As per CPR 24.2 the Defendant has no real prospect of successfully defending the claim and there is no other compelling reason why the case should be disposed of at trial.

 

It is clear that the defendant borrowed the money from the claimant as can be seen by the loan agreement in Exhibit 1. The Defendant signed a loan agreement which stated clearly that he borrowed the money from the Claimant.

 

The defense submitted by the Defendant is totally fabricated and without merit. The loan has not been repaid as the Defendant claimed. No other agreements existed, verbal or otherwise, to supplement this loan agreement.

 

If there were other agreements for any form of stage repayments this would be stipulated in the agreement. Similarly if there were any other terms or conditions they too would be stipulated.

 

The Defendant never made any attempt to repay the loan after many promises to do so, after many requests from the Claimant. The Claimant had waited nearly six years to be repaid. It is unequivocal and undeniable that the loan has not be repaid.

 

 

Exhibit 1 –the loan agreement

 

Should I submit a witness statement as Exhibit 2 to the affect that

a. he had not repaid

b. his claim that he had repaid in stages is false and that I never entered in to this agreement with him and he made no repayment for any amount.

 

Exhibit 3 – he stated that he acted as carer for my mother. This is totally false. My brother is a fully qualified carer and worked as a carer. He quit his job purely to look after my mother. My brother was so disgusted by the guy’s claim that my brother wants to submit an affidavit stating that only he cared for my mother.

 

Should I bother with that?

 

Replying to his counter claim – whats the correct form to do that?

Should I prepare a statement as Exhibit 4

 

My reply would comprise of the following

 

It is denied that the Claimant owed any money to the Defendant at any time. Even though the Claimant knows that no money is owed to the Defendant, and that there were no agreements, verbal or otherwise, the Claimant requests documented proof of his alleged indebtedness to the Defendant.

 

 

what do you think?

 

many thanks

Wrecked

[wrecked]

Hi Andy,

 

The N244 form asks for "Attaching a draft of the order" do you have a copy of such as i dont see it on line ( i can only see only American docs.)

Thanks

Wrecked

[AndyOrch]

Your Directions are as per your order you are requesting on a separate sheet along with the relevant CPR PDs so SJ is CPR 24.I will find an example and post shortly

 

Regards

 

Andy

[wrecked]

Hi Andy

 

thanks so much - i found this

http://www.compactlaw.co.uk/free-legal-precedents/small-claims-court.html#Affidavit2

and so i can follow SJ pretty much.

 

I am just a bit confused as to the draft order.

 

I 'll be grateful if you can send me a format for that so i can include this

 

thanks so much Andy

Best/Wrecked

[AndyOrch]

Hi Wrecked Hmmh has kindly provided a draft direction for you below

 

Regards

 

Andy

[hmmh1978]

You need a separate draft/Order sheet. Never ever dispense with an order except for the simplest of cases and this is not defined as a simple case. You have your claim, the counter claim and costs to consider.

 

#### START OF ORDER ####

 

In the ......... county court

Claim No. ...

 

Before

 

District Judge ………

 

 

Dated ……… 20…

 

 

Claimant A. B.

 

and

 

Defendant C. D.

 

 

 

draft/ORDER

 

 

UPON reading the Claimant’s Application Notice dated [ ] and the witness statements filed by the parties

 

AND UPON hearing the Claimant and Counsel for the Defendant

 

IT IS ORDERED THAT:

 

1. The Claimant be granted summary judgment on the whole of the claim and the counter claim by the Defendant struck out.

2. The Defendant do pay to the Claimant forthwith the sum of £[ ] in respect of the claim.

3. The Defendant do pay the Claimant’s costs of the claim, in the sum of £[ ] within 14 days.

 

#### END OF ORDER ####

 

Fill in the gaps where ..... or [ ] is present.

 

Do not forget to file a N260 as well.

 

The following are assumed:

 

1.) That in the hearing you will represent yourself;

2.) That the other side will be represented by counsel;

 

If any are not true, just amend the order to suit.

 

Good luck.

[wrecked]

HI Andy and HmmH,

thanks very much - will get it done and let you know. Many thanks

Wrecked

[wrecked]

Hi Andy and Hmmh,

 

i hv now sent

a. application for Sum. judgement

b. reply/defence against the counter claim

c. N260 expanses form

 

i stated in my N244 summary judgement Application that a hearing of 30 mins would be required.

I did this on the basis that he put in a counter claim even though there is no merit in his counter claim.

 

What do you think?

 

i will let you know as soon as i hear anything.

 

thanks for all your help/Wrecked.

[wrecked]

Hi.,

 

just to update

 

1. the case has now been transferred to a local county court for a hearing date.

2. if you are sent an Allocation Questionnaire, you have to complete it and submit it with your fees. This is mandatory. I did not know that.

The lady from Northampton CCBC told me that i did not have to submit the Allocation Questionnaire as i was applying for Summary judgement. This is not the case.

 

I just managed to submit the Allocation Questionnaire on time.

 

3. You do not have to copy the AQ to the other party... but I did

 

 

all the best

wrecked.

[AndyOrch]

Excellent Wrecked

 

There is only a fee for the AQ if its over £1500.00.

 

Regards

 

Andy

[wrecked]

Hi Andy

yes thanks - its £ 40.

tell me pl Andy - i think you will know this.

I am quite disabled and on ESA and DLA

 

Will I qualify for legal aid? what is the process to apply for one?

 

If i can am successful, will they refund my fees I have already paid (as i am desperately broke and i really can see this dragging on)

 

thanks

All the best

Wrecked.

[AndyOrch]

Hi Wrecked

 

There is no legal aid now as we know it as such but you would be exempt from fees see :- http://www.mensaid.com/documents/fl/ex160a.pdf

 

However you are the claimant you have requested your costs in the above directions.

 

Regards

 

Andy

[wrecked]

HI Andy

 

thanks very much - thats great. I'll go through it and get back to you

 

All the best

Wrecked.

[wrecked]

Hi Everyone,

 

The Summary Judgement application hearing date has been set for 20 Sept. and knowing the Defendant he will come up with something, at least a character witness or cook up something regarding his alleged repayment.

 

I am certain that I will receive something at the last minute.

 

My question is :

 

a. can the defendant submit a witness statement prior to the hearing - even though all the papers have been submitted?

b. Can I as Claimant submit a witness statement to add to my case?

 

Whilst I have submitted the loan agreement signed by the Defendant, it is still my word against his, and according to my research it would appear that for him to counter my summary judgement application, he only needs to cast some doubt over the agreement and claim that as i had deducted "his wages" he had repaid my loan (- which is totally false.)

 

i am sure that he will submit a witness statement to say what an honest person he is. So i want to be prepared by submitting a couple of witness statements to say what a dishonest person he is.

 

thanks/Wrecked.

[AndyOrch]

" My question is :

 

a. can the defendant submit a witness statement prior to the hearing - even though all the papers have been submitted? Yes providing its 7 days prior

b. Can I as Claimant submit a witness statement to add to my case? " Yes as above

 

Regards

 

Andy

[wrecked]

Thank you Andy thats very good of you.

All the best/Wrecked.

[wrecked]

Hi Andy

 

well had the hearing this morning and it did not go our way. The Judge dismissed my application for Summary judgement, on the basis that the Defendant had a defense when he stated that repayment was made through deduction of the debt from his wages. The judge listed it for a trial hearing on 25 OCT. for 2 hours. The Judge gave directions. He stipulated that

 

a.parties are to provide disclosure of all relevant documents to include Bank Statements, wage slips and any other documentary evidence of the loan and its repayment.

b. parties are to include in their documents, witness statements of all witnesses upon whom the parties intend to rely including themselves.

c. there is no dispute that money was loaned . The only dispute is the repayment... upon the defendant admitting that he had received the sum of £ XXXX., it appears to the court that the issue is whether the money has been repaid.

 

When i advised the judge that a loan does exist and that it had not been repaid., he said that it is up to me to prove that it has not been repaid.... simply because the defendant had claimed that the loan had been repaid as i was deducting it from his wages.

 

I really need your help on this one - please put your thinking caps on. Its pretty impossible for me to prove that he had not repaid it

 

1. he was paid in cash

2. he only received payment when when worked

3. I kept a record of pretty much all payments i made though there are some that are missing

 

just as i hv to prove that i have not been paid, he has to prove that he has repaid me - so its pretty much my word against his. and unfortunately, now, the loan agreement he had signed does not seem to

be relevant.

 

I know sometimes he banked the cash I paid him and other times he does not. But more specifically, there are times when he gets less simply because he did not work.

 

I guess i'd be able to think better after a few days but right now, i am pretty blown away.

 

so i look forward to your comments on this

 

thanks/Wrecked

[Mike_hawk]

Depending on whether the order is drafted in a similar vein as c. below I would think the onus has been firmly placed on the defendant to prove. If he was drawing a wage I'm sure he'd be able to provide copies of P60's or the offsetting of repayments within his self assessments for the period.

 

Send him a part 31 request for copies, there doesn't appear enough time for a standard disclosure order so you may as well start digging now so you can add to your w/s next month.

 

c. there is no dispute that money was loaned . The only dispute is the repayment... upon the defendant admitting that he had received the sum of £ XXXX., it appears to the court that the issue is whether the money has been repaid.

[wrecked]

Hi Mike

thanks for your message. i noted down and listed what the judge said so i guess that will be in the directions but i guess we should wait to receive them. In the meantime, he has listed the hearing for one months time, but he made no mention of time/deadline for disclosure although he did say that we have to present all documentation.... so i guess we hv to present and disclose each others papers seven days before the hearing date at the latest. Regarding proof - he did say that i have to prove that i did not receive the repayment.

 

Will you pl send me a link so i can download/check out Part 13. And if i send a part 13 to request copies, surely he can do the same.

 

is there anything else?

thanks/Wrecked

[Mike_hawk]

Hi Wrecked

 

This thread may assist with part 31, you'll need to adjust the template at post #1 to suit http://www.consumeractiongroup.co.uk/forum/showthread.php?159445-Getting-Them-To-Reveal-Their-Vitals.-Using-CPR-31.14-to-Your-Advantage

 

Post your version on here before you send it and we can take a look to ensure it all appears in order.

 

If he was employed by you [per his claim], there should be evidence of this within P45's, P60's or self assessment. You should try to bear in mind that the court won't be particularly interested in whether he discharged his tax liability but these are documents that any reasonable person should have retained or be able to provide copies of.

 

I suppose you could also add a further line requesting disclosure of the contract between you to include agreed remuneration value.

 

Not sure how you can prove a negative if these were cash transactions? Perhaps by focusing more on the counter claim argument and casting doubt on his particulars it may add greater weight to your position.

Edited September 21, 2012 by Mike_hawk