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AIBU?

For threatening to take a relative to small claims court over unpaid debt?

15 replies

cantpaytakeitaway · 20/03/2021 18:49

I loaned a relative a large sum of money a few years ago and they agreed to pay be back my a certain date.

Said date is looming and I'd like my money back.
We're not on speaking terms which is very convenient for them!

AIBU to relative them to small claims court if they fail to pay me back by said date?

As mentioned, it was a large sum of money and given the pandemic, I recognise it may not be possible to pay it all back at once.
However, I think regular monthly payments (as opposed to nothing) is completely fair. I plan to notify them of my intention to take them to SCC if no repayment schedule is agreed.


To add: relative has a terrible habit of borrowing money from relatives and I should never have loaned them money in the first place. However, I was manipulated by them and couldn't see it at the time sadly.
They relative owns a property which can (and should) be sold to clear their debts.

Has anyone been in this situation before? Were you able to get your money back?

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cantpaytakeitaway · 20/03/2021 19:33

@Buggerthebotox

There's a pre-action protocol in the National Debt line library (sorry can't link).

Really helpful, thank you!
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cantpaytakeitaway · 20/03/2021 19:26

To add, AFAIK this relative hasn't been taken to court over outstanding debt before but has always managed to wiggle out of it. Either by borrowing from Peter to pay Paul or by taking out credit cards.

It's entirely unsustainable and now that I've "gone clear", I recognise I should never have loaned the money in the first place.

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cantpaytakeitaway · 20/03/2021 19:23

@gobbynorthernbird

OK, just to warn you that you might not have the choice as to a lump sum or instalments. You also need to think about what you'll do if they fail to satisfy a judgment. Would you instruct enforcement (who can't do much unless there's a credit-free car in the debtor's name parked somewhere accessible), or put a charge on their house?

How much is the debt?

I understand. Ultimately, as long as I have something in black and white that states how I'll get all the money back I'll take it.

What I don't want, is what I think this relative's done in the past - borrow money from family (even with an agreement in place) expecting that they won't ask for it back because they're family.

I would make a claim via small claims court or statutory demand.
I wouldn't make the claim against their house, I was just including that for context re relative's situation.
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Buggerthebotox · 20/03/2021 19:22

There's a pre-action protocol in the National Debt line library (sorry can't link).

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Buggerthebotox · 20/03/2021 19:20

Check they're in breach of your contract, email/write and if no joy, issue proceedings. Keep everything in writing, make sure you can track post etc and go for it.

Sometimes the threat is enough.

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gobbynorthernbird · 20/03/2021 19:15

OK, just to warn you that you might not have the choice as to a lump sum or instalments. You also need to think about what you'll do if they fail to satisfy a judgment. Would you instruct enforcement (who can't do much unless there's a credit-free car in the debtor's name parked somewhere accessible), or put a charge on their house?

How much is the debt?

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ChorltonWheelie · 20/03/2021 19:13

Might be useful OP

www.gov.uk/make-money-claim

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cantpaytakeitaway · 20/03/2021 19:05

@gobbynorthernbird

And, yes, remind them now. In writing. And then on the due date, assuming they haven't paid up, give them 30 days notice that you'll issue proceedings.

Sounds like a plan, thanks!
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cantpaytakeitaway · 20/03/2021 19:04

@gobbynorthernbird

Other than selling their home do they have the funds to pay you back? And do you need the money in a lump sum? They may be allowed to make monthly payments over a long period of time.

Re the property they own, they don't live there - never have done. It's a rental.

I was thinking monthly payments over a long period of time but the agreement stated the lump sum would be paid in full on or before said date.

It also stated the borrower would be responsible for any legal costs needed to recover the debt.

I just did some maths and depending on how small the repayments were, it could take close to/in excess of a decade.

As mentioned in my OP, I was manipulated into loaning them the money so would really rather it back in a single lump sum.
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gobbynorthernbird · 20/03/2021 18:57

And, yes, remind them now. In writing. And then on the due date, assuming they haven't paid up, give them 30 days notice that you'll issue proceedings.

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gobbynorthernbird · 20/03/2021 18:55

Other than selling their home do they have the funds to pay you back? And do you need the money in a lump sum? They may be allowed to make monthly payments over a long period of time.

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sueelleker · 20/03/2021 18:54

I'd remind them ONCE (email or letter) then follow through.

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cantpaytakeitaway · 20/03/2021 18:52

Just had a quick look and the agreement states the loan will be paid in full (or before) by said date.

^ Should I contact now to get a status update? Ahead of said date given this...

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cantpaytakeitaway · 20/03/2021 18:50

We have a contract that was signed between us.

Conveniently they had one to hand.

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Easterbunnygettingready · 20/03/2021 18:50

Have you got anything in writing? They could claim it was gifted money.

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