My friend lend one of his friend 15k for his business. My friend has a contract for it too. The person uses his business for collateral, later he sold the business. He didn't pay him back yet, but in the contract it says the person uses personal guarantee for it. The person that owes my friend money is leaving the country and their home is closing on Dec 15. Is there a way my friend that stop the closing or get money back from it? PM me if you can help. Thanks in advance.
Need help, guys! Anyone a lawyer here?
- Thread starter hornykid
- Start date
From a legal standpoint, you sound a lot like you need help.
Call a lawyer, not a terbite.
If you don't know any lawyers, the Law Society of Upper Canada has a referral service that costs $6, you can have a free consultation to discuss options then decide if you want to hire someone.
Call a lawyer, not a terbite.
If you don't know any lawyers, the Law Society of Upper Canada has a referral service that costs $6, you can have a free consultation to discuss options then decide if you want to hire someone.
And it's not the kind of help that can or should be given via TERB.DATYdude said:
Either I’m not grasping something or your friend needs to seek new Counsel ASAP, what did their agreement say regarding repayment? Has your friend demanded repayment in accordance with the note's provisions or was it poorly drafted? It's a bit unclear from what you write, but you suggest that there is an element of fraud here in that the borrower is attempting to leave the country without repaying the loan and has no intention of repaying it?
I'm not a lawyerhornykid said:
. However, I used to work for a real estate lawyer. If the guy who owes your friend 15k owns a home then a real estate lawyer can file a writ of execution against this guy. This lien would prevent the guy's home from closing until it is paid off.I would call a real estate lawyer right away as the Dec 15th closing is very soon. Hope this helps. I think it takes a few days to file this lien. Therefore, time is of the essence. Have your friend call a real estate lawyer on Monday. Good luck with everything!
Your friend should take his payment out of the guy's teeth....possibly a kneecap or a spleen, depending on how badly he was screwed.
Ah! I long for the old days when things like this would be settled by hand to hand combat.
*wistful sigh*
Ah! I long for the old days when things like this would be settled by hand to hand combat.
*wistful sigh*
Actually, depending on the type of loan, it could be that the business owes the 15K, not the business owner but I guess that would depend on whether the business was an LLC or a corporation.
If the debt was a business debt, the debt went with the company. If this is the case, they're going after the wrong people.
If in fact the business was registered as collateral on a loan, the new owner would have been aware of this debt when he purchased the business.
From the sounds of it however the first lawyer was correct: he's SOL (shit outta luck).
BTW: you may not be able to stop the sale of the house but if this was a personal loan, you can still get a judgement filed against the borrower and if you keep track of him, (it WILL be up to you) once this judgement is filed if he returns to Canada and tries to get a credit card, loan, whatever, it will be on his record.
I'm not sure what the limit now is for small claims court but you don't need a lawyer for it (especially if you have signed contract and records of payment/non payment).
So, this guy's leaving the country, has he divested himself of all bank accounts, credit cards, property, cars etc here?
If he has anything in Canada, you can attach a lien to it.
(btw, dream has the simple straightforward approach to debt collection).
If the debt was a business debt, the debt went with the company. If this is the case, they're going after the wrong people.
If in fact the business was registered as collateral on a loan, the new owner would have been aware of this debt when he purchased the business.
From the sounds of it however the first lawyer was correct: he's SOL (shit outta luck).
BTW: you may not be able to stop the sale of the house but if this was a personal loan, you can still get a judgement filed against the borrower and if you keep track of him, (it WILL be up to you) once this judgement is filed if he returns to Canada and tries to get a credit card, loan, whatever, it will be on his record.
I'm not sure what the limit now is for small claims court but you don't need a lawyer for it (especially if you have signed contract and records of payment/non payment).
So, this guy's leaving the country, has he divested himself of all bank accounts, credit cards, property, cars etc here?
If he has anything in Canada, you can attach a lien to it.
(btw, dream has the simple straightforward approach to debt collection).
Sorry tboy...you're incorrect on a number of counts. The original post says there's a personal guarantee, so going after the guy's house is the right move. Also, new owners aren't necessarily aware of (nor are they necessarily liable for) any of the previous business' debts. It's actually simple to get around. Third, a judgment in Ontario is NOT enforceable all over Canada. Some provinces have reciprocal judgment agreements with Ontario, some don't. Finally, the Small Claims limit is now 10k.tboy said:
Bottom line, there's not enough time to get the guy served & get judgment, so he won't be able to file a writ. SOL.
Well, it also says he used his business for collateral, so what's a personal guarantee? "I promise to pay you back"...then if that's what was securing the debt, why did he put up the business as collateral?Bobzilla said:
If the seller of the business "hid" the debt which used the business as collateral, then the new owners could go after him for non-disclosure.
If this was a personal loan (and it sure doesn't sound like it) then yes, the lender can go after any and all personal holdings (be it property, vehicles, home furnishings etc).
I'm not a lawyer but as the OP's "friend" has been told by a lawyer already "he's sol".
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Never said it wasn't but this could be one of those "trying to get blood from a stone" situations.Aardvark154 said:
I wonder, does anyone here know if he does win a judgement against the borrower can the lender recoup his legal costs as well? In full? Partially?
See the Ontario Rules of Civil Procedure §58.05. In reality likely to be a percentage of costs. However, once again something to be discussed in person with a lawyer specializing in Civil Litigation.tboy said:
In general Legal advice on the Internet is worth what you pay for it.
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