Legal Question in Credit and Debt Law in New York

Re: Where & How do I begin (small claims)?

small claims actions are usually brought in a court close where the debtor resides. As Mr. Starr points out, unles you have an agreement in writing, copies of checks paid to your friend do not prove the funds were meant as a loan, and not a gift it is just proof that you gave him money. In a court, you have to PROVE your claim. If it comes down to his word against yours, you may lose even if the judge believes you both equally because you have the BURDEN OF PROOF. It would be a great benefit to you (and your lawsuit) if you first went to the "friend" and asked that he repay some small portion of the debt (like you need $50 real bad for medecine) and that you would give him a receipt for the repayment...and on the reciept you would write something like "Received from my pal $50 as partial payment of $xxx.xx loan made on FILL IN DATE. Balance to be repaid in full by FILL IN DATE." If he is stupid enough to fall for that and signs the note, at least you'd have something in writing you can rely on if you had to sue him. You could even make a small mistake in math and put a smaller amount in the note...he might jump at the chance to cheat you out of a few bucks...but by doing so he might give you a lock on the balance...get it? Next time, by the way, DON'T LEND MONEY TO FRIENDS...that's the best way to lose a friend...

Re: Where & How do I begin (small claims)?

If you loan money to someone (even if a friend or relative), it is a good idea to have a written agreement that sets for the terms of the loan. If it is a relatively small amount that doesn't justify hiring a lawyer to draft an agreement, there are promissory note forms that can be purchased from stationary stores that carry legal forms.

If you are now in the situation where you loaned money and aren't getting repaid and don't have any have any sort of writen agreement, you will need whatever proof you have that it was a loan and not a gift. You should be able to obtain copies (front and back) of the credit card checks from the credit card company. The other side will get to present their version of events. If there were witnesses who saw the loan being made and heard you and the person you loaned the $$ to agree on the terms of the loan those witnesses can testify about what they saw and heard. If there are no documents and no witnesses, it will boil down to who the judge finds more trustworthy and believable.

Good luck,