HELP - i lent £10k to a friend who wont pay it back? What can i do legally

Louisa28

Yep transfered to him electronically and he transfered it back to me that way too. yep thats what the dept company said - that hes already admitted liability.

Good idea ill check my house insurance out. thanks for that.

Tixy

With no written agreement your chance of obtaining a CCJ against him is slim and I'd be cautious about spending more money on this (certainly don't pay the debt collection company that would be a waste of money).

You could try sending him a letter before action threatening court action in the hope that it might make him repay or get him to contact you to arrange a repayment plan, that option won't cost you anything at least (well aside from postage). Don't threaten to make him bankrupt though, threatening bankruptcy will make it look like you don't have a clue and haven't taken proper advice, a formal letter before action will make it look like you do know what you are doing or have at least taken advice.

garth549

I'd write him a letter threatening county court action if he doesn't respond within 30 days (I wouldn't actually go ahead though). Offer a reasonable repayment plan in the letter eg I'll accept £50-£100 per month for 5-10 years. This might be you best shot.

Edit: Also if he does reply and acknowledges the outstanding loan, this could give you evidence to actually proceed in court.

dtsazza

ihateyes wrote: »

i would think the email and the fact he has made electronic payments would make a money path.

Did you transfer the money to him electronically?

I would speak to a solicitor, and bring all bank statements that shows him paying you, and your statement showing 10K paid to him. while there is no agreement, he acknowledges you gave him money by paying you back!

That's the thing though - it doesn't provide any evidence of the actual agreement.

The OP will claim that it was a £10k loan to be repaid as £10,500 in January, which is now in arrears. The other guy could claim it was a £10k semi-loan, to be partly repaid in January and July, and that he could keep the remaining £5,500. Or he could claim it was an out-and-out gift of £10k, after which his situation improved and he felt like paying his "mate" back some of the money as a favour.

The electronic record is consistent with any of these interpretations.

It captures that money changed hands between the two parties on three occasions, but it captures neither the intent and motivation behind these transactions, or more critically any promises for future transactions.

It is sad but without a legally binding loan agreement, there is no enforceable/collectable debt. Unfortunately this case has become yet another example of why you should never lend to friends or family (unless you're prepared to write off the money as a gift).

DCFC79

Can i just ask what your friend said to influence you to lend the cash ?

somethingcorporate

dtsazza wrote: »

That's the thing though - it doesn't provide any evidence of the actual agreement.

The OP will claim that it was a £10k loan to be repaid as £10,500 in January, which is now in arrears. The other guy could claim it was a £10k semi-loan, to be partly repaid in January and July, and that he could keep the remaining £5,500. Or he could claim it was an out-and-out gift of £10k, after which his situation improved and he felt like paying his "mate" back some of the money as a favour.

The electronic record is consistent with any of these interpretations.

It captures that money changed hands between the two parties on three occasions, but it captures neither the intent and motivation behind these transactions, or more critically any promises for future transactions.

It is sad but without a legally binding loan agreement, there is no enforceable/collectable debt. Unfortunately this case has become yet another example of why you should never lend to friends or family (unless you're prepared to write off the money as a gift).

This is exactly what we were taught in our accountancy training - unless there is concrete proof it was commercial arrangement (i.e. a signed contract existed) a judge would be 'forced' to assume it was a social arrangement (a gift). Which means so many lenders to friends and family get the shaft.

You can try and hustle or embarrass them in to paying but going via the courts is likely to not be successful.

lawrie28

I'd go and see his Mum. Nothing like a Mum knowing their child has done something seriously wrong to make someone change their mind!

Louisa28

Thank you everyone..... ive never met his mum but worth a try i suppose! x

MonkeyMad

I don't think the fact that you transferred £10K to him and he transferred some back to you at a later date proves anything since they are tjust transactions.

He could equally claim you owed him £10K which you were paying back initially.

LovelyLeeds

Louisa28 wrote: »

Thank you everyone..... ive never met his mum but worth a try i suppose! x

I really wouldn't advise it, it could get out of hand, you don't know anything about her, nor she you.
He knows he owes the money, I can't imagine a shaming strategy will work, and it's not fair to put your problem on to his mum.