UnSigned Prommisory Note

[Zigner]

I disagree. Whether or not the promissory note is enforceable as written, it's pretty clear that there was an enforceable loan agreement, and the creditor under such an agreement unquestionably has an insurable interest in the life of the debtor.

I would agree that there may have been (and likely was) an enforceable agreement, but that's an issue for a court to decide (if the insurance company should decide to pursue it). If the court concludes that there was, then there's no question of an insurable interest, but if the court concludes there wasn't, then there is no insurable interest.

That's why I used the word "may"

 

[adjusterjack]

it's pretty clear that there was an enforceable loan agreement, and the creditor under such an agreement unquestionably has an insurable interest in the life of the debtor.

Very true. And quite common in business arrangements.

 

[nope]

Agree, if the ex-partner fails to pay upon the sale of the property.

But OP seems concerned about not being paid the next payment.

No Im not worried about $900. My partner is still current on those payments. He just thinks he can walk away from the house sale pay off. And since oral contracts are enforceable, my note should be pretty easy judgement, given the payment evidence I have and can subpoena. I just dont know if I can stop him from spending all the house sale money before any legal action can take effect. Paying off all credit card debt for him and all his kids, buying a fancy motor home to stay mobile, etc, etc. All that cash could vanish in 2 weeks. And he is currently throwing out most all the stuff he owns including tools. And he doesn't tell me anything. So he's got something going on. He may already be living somewhere else than his home. With it being spotless for showing. I still have to hunt around and see where he goes from work.

And here is the language of the note:

for value received, the undersigned hereby jointly and severally promise to pay to the order of ME the sum of $134,400.00, together with interest thereon at the rate of 8% per annum on the unpaid balance. Said sum shall be paid in the manner following:
$896.00 monthly interest only payments until the sale of ADDRESS,Ohio. Terms to be reconsidered within thirty days proceding the sale of ADDRESS,Ohio
All other contractual obligations (promissory notes) prior to Feb 20, 2011 with ME shall be terminated upon the signing of this "Promissory Note"

And I am sure the life insurance policy lapsed long ago, and I have it as proof we did do this note. At the time, I wanted my money back, and with my luck, he would get killed somehow and I'd be screwed. So I demanded the insurance policy with me being named. His wife is also named on it too for a portion of the policy. But I don't expect anything out of it. I just want to do what I can do now to give me the best chance at getting my money back.

 

[army judge]

I just want to do what I can do now to give me the best chance at getting my money back.

According to your revelations, you've been paid in full by the other party.

According to you, the other party paid you monthly $900 in an envelope, which held the cash payment.

He did that monthly for 156 months.

A quick calculation reveals the following amount you were paid.

156 months * $900/month = $140400.00.

Plus you reported the following above:

What is the total principal amount to be repaid according to the unsigned note? $134,400. His house is pending at $350,000. About 3 times what it was 13 years ago.

If I were you, I'd let this go.

Perhaps you might believe you were shortchanged.

However, consider yourself lucky you received whatever you got.

People regularly get wounded, stabbed, beaten, or even killed over lesser amounts. Take the $140K and be grateful you can walk away.

In the future, when someone asks you to loan him/her/it/them money, politely inform the entity that you're not a bank or finance company. Then quickly disappear yourself.

 

[army judge]

since oral contracts are enforceable, my note should be pretty easy judgement, given the payment evidence I have and can subpoena.

Oral contracts aren't allowed when real property is involved.

Ohio's Statute of Frauds – Get it in Writing!
By FINNEY LAW FIRM | DECEMBER 22, 2019

As discussed in a previous post, courts will only enforce contracts for the sale of real estate if the contract is in writing (and signed by the person against whom you seek enforcement).

The legal principle that requires certain contracts to be in writing is the Statute of Frauds. In Ohio, the Statute of Frauds is codified in Chapter 1335 of the Ohio Revised Code; and the Statute of Frauds covers more than just real estate contracts (both sales and leases). For example, R.C. 1335.02 requires loan agreements with financial institutions be in a signed writing to be enforced. However, "the use of a credit card results in the person using the card being bound by the card member agreement." Citibank, N.A. v. Ebbing, 2013 -Ohio- 4761, ¶ 13, 2013 WL 5783722, at *3 (Ohio App. 12 Dist.,2013)

R.C. 1335.05 extends the Statute of Frauds to a promise to pay the debts of another person; an executor's promise to pay the debts of the estate from her own funds; an agreement made in consideration of marriage; and for contracts that are not to be performed within one year.

R.C. 1335.11 further extends the requirements of the Statute of Frauds to sales commissions.

These same subjects are covered by Kentucky's the Statute of Frauds at K.R.S. 371.010.

Despite the formal language of the statute, we see these in everyday life: a parent cosigning on a child's student loans for instance. An agreement made in consideration of marriage includes prenuptial agreements (but not the agreement to marry itself).

When faced with oral agreements that are not to be performed within one year, courts will often engage in detailed analysis to determine if it is possible that the contract could have been performed within one year. For instance, in Jones v. Pouch, 41 Ohio St. 146, 1884 WL 84 (Ohio 1884), the Ohio Supreme Court ruled that an oral contract to construct a section of road in 1 year and 20 days was enforceable, because it was possible to have completed the work within one year, the additional twenty days were merely a precaution against contingencies. This case is still good law and was cited in the 2015 edition of Williston on Contracts despite being 131 years old.

Additionally with respect to agreements that are not to be performed within one year, Ohio's courts have determined that the statute of frauds will not bar recovery where one party has fully performed their obligations under the contract but has not been fully paid. In another 19th century case, Towsley v. Moore, 30 Ohio St. 184, 1876 WL 176 (Ohio 1876) the mother of Olive Towsley, an 11 year old girl arranged for her to work in the home of Mr. Moore until she turned 18, in exchange for room and board, and, when she turned 18, Moore was to pay Olive the value of her services. The Court rejected Moore's argument that the statute of frauds prevented Olive from recovering the value of her services. Ultimately, Moore was ordered to pay Olive $300.00 for her nearly 7 years of service.

Even where a contract fails to satisfy the requirements of the Statute of Frauds and a breach of contract claim cannot be brought, a claim for unjust enrichment or other equitable claims may allow you to obtain a just result.

Whether you are the borrower or the lender, employer or employee, you can avoid these questions by getting your contract in writing and signed by all parties.

Ohio's Statute of Frauds – Get it in Writing! - Finney Law Firm

 

[welkin]

I wouldn't walk away from $134,000. The note says interest only payments until the borrower sells his house. The $140,000 OP received is interest only. He is still owed the original $134,400.

Said sum shall be paid in the manner following:
$896.00 monthly interest only payments until the sale of ADDRESS,Ohio

 

[Zigner]

I wouldn't walk away from $134,000. The note says interest only payments until the borrower sells his house. The $140,000 OP received is interest only. He is still owed the original $134,400.

Why do you believe there's an enforceable agreement?

 

[zddoodah]

I just dont know if I can stop him from spending all the house sale money before any legal action can take effect.

I do. You almost certainly can't.

You could try to obtain a pre-judgment writ of attachment. I don't know how courts are in Ohio about this, but the standard for something like that is incredibly high.

If I were you, I'd get off the internet and into a local attorney's office to discuss if there are any viable prejudgment remedies. Otherwise, once the sale is complete, and assuming you don't get paid within a reasonable time, file your suit and hope for the best.

 

[welkin]

Why do you believe there's an enforceable agreement?

Because he has the note and he has been paid according to the terms for 13 years (interest only). That is not by coincidence or out of the goodness of the borrower's heart.

 

[Zigner]

Because he has the note and he has been paid according to the terms for 13 years (interest only). That is not by coincidence or out of the goodness of the borrower's heart.

What note?
An unsigned note is no note at all.

 

[welkin]

What note?
An unsigned note is no note at all.

The note, although not signed spells out what the terms of the agreement was. Or do you think that OP's friend just decided to gift OP $900 a month for 13 years. I think OP has a good chance of enforcing a verbal contract based on the facts he has shared.

So if I were OP and you were his friend and I sued you, what would be your answer to the court when asked why you gave me $900 per month for 13 years?

 

[Zigner]

The note, although not signed spells out what the terms of the agreement was. Or do you think that OP's friend just decided to gift OP $900 a month for 13 years. I think OP has a good chance of enforcing a verbal contract based on the facts he has shared.

So if I were OP and you were his friend and I sued you, what would be your answer to the court when asked why you gave me $900 per month for 13 years?

At that point, I'd argue that the original amount was paid in full (plus some extra).

 

[zddoodah]

The unsigned note is, at best, evidence of a verbal agreement.

The biggest problem with the unsigned note is that, if the debtor denies that it's 13-year old document, then an unsigned piece of paper isn't going to be of much probative value. If I were deposing the OP, I'd be asking how we could know that the document wasn't created and printed two weeks ago.

The biggest thing the OP has going for him/her is the 13 years worth of payments that are consistent with what the unsigned note says. Without seeing all of the documentary evidence, it's quite impossible to form an intelligent opinion about the OP's true likelihood of success.

 

[nope]

Yea, Im pretty sure the note is enforceable. Obviously with a court judgement required. Because he did pay me for 13 years, I have all the envelopes, and I can get his bank records to corroborate money from him to me. kinda like what they are doing with Biden. Additionally I was named in a life insurance policy at the time the note was made. We are not family and his wife is on it too, so it is another indicator that we had a business arrangement that the insurance was protecting. So he can't claim, he knows nothing. He can't claim he paid nothing. And it would be hard for him to invent an elaborate alternative explaination for what has been going on. And the failure of that elaborate explaination would simple add to his bad faith in court. His attorney would not be egging him on in presenting anything but the truth. And his attorney would not want to get mixed up in all this with nothing more than hourly pay rates. I have the note and would probably have to give up 50% for my representation. But I have the extrainious documentation, even though I don't have signatures. I even saw a website that says "call us for unsigned promissory notes". So I have a reasonable path to a judgement. But it's that turnip factor. That is the gotcha that I am sweating. Making all that sale cash vanish before anything can be done.

I have not been belligerant with him. No threats, or even hints of my current research. I just carry on like no sweat, the note is bullet proof. I planted doubts in his head, and that made him offer to throw me a bone. I said with no enthusiasm that I would think about it. So, it's a mind game right now, as he deals with "Pending". There may be a problem with the pending. I heard talk of home inspector issues. That could work in my favor. Giving me more time. But the info here is very useful. I can't do anything while he is not in contract breech. So, that keeps me from doing something that shows my cards. My partner may not even know I still have the insurance policy. So its a detail that could trip him up if he tells legal people made up stories. I may try to see if he will agree to a smaller lump sum and continued $900 payments to work on the rest. The note says new terms to be worked out post sale. Of course that could also mean $1/month from here on. I'm keeping it civil, as I keep my phone recorder ready. Who know what more evidence I can get to help me out.

As for the website, it's a last resort. I'd rather find local attorneys that know these judges. Anyways, that is where it's at for now. Im looking around to see if he has another place to stay. He has thrown away so much, that he must have move the basics somewhere else. Pictures in the websites show a beautiful place with furniture I suspect he is leaving behind.

 

[Zigner]

Yea, Im pretty sure the note is enforceable.

That's your conclusion? Even after seeing the law on the matter with your own two eyes?

 

[adjusterjack]

Making all that sale cash vanish before anything can be done.

Making his cash vanish has nothing to do with the enforceability of the note or your ability to get a judgment.

He has every right to spend his money.

All the judgment will say (if you win) is that he owes you. You still have to collect, which could be another expensive legal process.

You are naive about so many things.

 

[welkin]

At that point, I'd argue that the original amount was paid in full (plus some extra).

And at that point, you would be committing perjury. Shame on you. But you would lend credence to the fact that you were paying interest only in the proper amount on the principal amount for 13 years. And don't forget the insurance policy that you took out at the time of the agreement naming me beneficiary, also fixing the date of the note. Not to mention all the parol evidence of the house flipping, expenses to do the flip, paying off credit card companies with the money, just to name a few.

There is plenty of case law in Ohio on the enforcement of unsigned promissory notes and contracts.

That's your conclusion? Even after seeing the law on the matter with your own two eyes?

What law?

 

[nope]

Making his cash vanish has nothing to do with the enforceability of the note or your ability to get a judgment.

He has every right to spend his money.

All the judgment will say (if you win) is that he owes you. You still have to collect, which could be another expensive legal process.

You are naive about so many things.

Clearly I dont have everything figured out. That is why I am dealing with him carefully. I certainly see no point to walking away from all this. It's not like he can take anything back from me. Nothing ventured, nothing gained. If he is serious when he says he is open to some agreement, then it's possible I can get a signed agreement for something. Which itself is better than nothing. From there it's fishing for other avenues. I have made a list of area contract attorneys. I will start with the ones saying free consultation, to hear who they are and what they say about this. That will give me more info about this situation in relation to my neck of the woods. Certainly, if I run into a Judge Engoron type, in my local courts, he could quickly say no signature, judgement denied. Some places have too much crime on the docket to mess with something like what I got. So it's a fishing expedition on all possible avenues. That is my thinking in all this. And collections is certainly a concern even if I win. I really dont know what this guy is up to. He is a home rebuilder. Not so much a clever crookster. And he has family. So he could skip, or declare bankruptcy, but he would have to be setup to live a life basically on the run and unplugged. And he doesn't know much about the computer world. So Ill track down his current location and see what I see. If he has a stuffed motor home somewhere else. Obviously that would tell me alot. So I need to figure that stuff out, along with all the legal options info. Then I could make a more informed settlement with him, if that comes up.

 

[Zigner]

Some places have too much crime on the docket to mess with something like what I got.

I'd just like to point out that civil matters such as this are separate from criminal matters.

 

[army judge]

I wouldn't walk away from $134,000. The note says interest only payments until the borrower sells his house. The $140,000 OP received is interest only. He is still owed the original $134,400.

Your assumption presumes the validity of the UNSIGNED promissory note, which remains at question.