Lending money

Jaymat

A friend was offered £6000 as a gift to sort out some issues and was told there was no rush to pay it back. Nothing was signed and the money was offered to her.

She paid back £2000 last year and still owes £4000. She has received a solicitors letter saying that this friend wants his money back but not just the £4000 owing which she will happily pay back. but for nearly £10,000 as he has included interest and tax on top.

How is he able to do this if it was a gift. What does my friend need to do about it. She is seeing Citizens Advice on Monday. Surely this person cannot ask for £10,000 without prior contract mentioning tax and interest and of course signed by them both?

She is really upset by this and i hope someone can offer advice so i can put her mind at rest.

Any ideas people???

Tixy

You say nothing was signed - was there anything written at all in relation to it? Or has there been since? e.g emails from her asking when he wants repaying or saying she cannot afford to repay at the moment? or even texts / facebook messages etc or anything at all that could help with his case?

If not then his chance of successfully proving that it was a loan or that a debt exists is very slim.

However you do say she repaid £2,000 of the gift. That sounds like the 2 parties never intended it to be a gift, but a long term loan.

How was the money originally paid to your friend? how did she pay back a proportion of it?

Even if it was considered by both parties to be a loan - he has no grounds to charge interest on it. And tax? there is no tax involved in a loan.

dealer_wins

As I see it, if it goes to court, the person she received the money from will need to provide proof that it was a loan.

If as you say it was a gift, then she has nothing to worry about.

Jaymat

She has been receiving threatening text messages and then a solicitors letter this morning. She always said she wanted to pay him back as she is not a fraudster and even after all this agrees to pay back the £4000. The £2000 she paid was because she got some money from a endowment and so used it to pay him some back. He offered the money she did not ask for it. However she always told him she would pay it back and he told her there was no rush.

Jaymat

Ive just messaged to ask her if she has replied to the text messages. awaiting a reply.

McKneff

He cannot just add interest and tax (lol, what kind of tax)

If she just keeps on paying him, there isnt a lot he can do, and only the balace, nothing else.

[Deleted User]

Verba volant, scripta manent is a Latin proverb. Literally translated, it means "spoken words fly away, written words remain".

If there's nothing in writing, I therefore suggest that your friend does nothing except paying back the other 4000 when she can as originally agreed.

Jaymat

He gave her the money via cheque and she paid back the £2000 cash. (which i am quite upset to hear) She has replied to the letter saying what she was given and what she owes.

So are you saying that if she goes to court she will only have to give the £4000 back?

Jaymat

Thank you so much everyone. That has really helped.

Tixy

She has written back to the solicitor already? before waiting for advice or speaking to CAB at her appointment?

That sounds like she has admitted to the solicitor that it was indeed a loan that was intended to be repaid. This will give him a much greater chance of obtaining a CCJ against her (even if only for the original capital).

Jaymat

He has acknowledged in a letter that she did pay back £2000 which should help her luckily. He has also acknowledged in a letter that she originally had £6000. I've told her to save all the threatening text messages. Should she see a solicitor about paying back the £4000 in some kind of agreement?