Legal Question in Credit and Debt Law in New York
Small Claims Court
Hello and thank you for reading my question. I received a notice to appear in small claims court as the defendant, regarding a loan of $3500 my elderly mother borrowed from her friend. I later found out she lied, that i needed the money for medical bills, which i did not. I did not know about the loan until this time. I have been told there is no loan aggreement in writing. Everyone is telling me i HAVE to go to court, or a judgement will be placed on me. Im very nervous, as ive never been in court, and im afraid this man will lie or say anything to get his money. Do you have any advice? Your help is greatly appreciated.
2 Answers from Attorneys
Re: Small Claims Court
My colleague is correct. You have to go. It does not matter what reason your mother told to get the funds. If you knew they were borrowed you have to repay the loan. BUT...legally you may not have to pay the plaintiff since you did not borrow the funds from him/her and you did not speak to the lender. Your grandmother borrowed the money and she in turn gave it to you. She has to repay the loan and since she gave you the funds you would have to repay her. THe statute of frauds requires that agreements to pay the debt of others must be in writing. there was nothing in writing from you to the lender telling him he could sue you for the funds he lent to your ma.
Re: Small Claims Court
Go... You are a third party bebenficiary of the money. An arbitrator may find you liable, but your argument is that you did not borrow the money, nor knew bout it, nor is there anything in writing.
If you do not go,yor frioends are correct, a default judgment maybe taken against you. Deal with the problem head on, as you are doing now.
Good Luck.
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