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Bum loan - need some advice please

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wtd

Member
Nevada

I loaned 1500.00, in two portions, to a friend (a single woman) who was starting a new business. The first was to the individual prior to incorporating for 750.00. The second was subsequent to incorporation and was loaned to the corporation for an additional 750.00.

There was no written agreement, however both checks were noted "Loan" on the check and it was verbally agreed that I would be repaid in about 90 days.

Its now about a year later and I'm going to have to file a claim in small claims court, as I am constantly getting the "I'll pay you within the next 30 days" routine.

The woman subsequently married.

Her business, a bookeeping and tax preparation business, is pretty hand-to-mouth, most of her income is in one hand and out the other sans a trip through a bank account. She overdrew her account so many times they closed it, so currently there is no bank account. (Hard to believe, but she really is a good bookkeeper, just a lousy businesswoman).

The business has very few assets - a couple of old computers, some cheap office furniture, etc.

The business is run more like a sole proprietorship than a corporation, with comingling of funds, etc., the woman is the sole employee and just spends the money pretty much as it comes in - no regular salary - more like a draw.

Assumptions -
1) This will have to be filed as two separate claims, as it really is two separate transactions.
2) I don't think that I'll have any problem prevailing in small claims court, even without a written agreement, as the checks that I gave her are clearly marked as loans.

Questions -
1) An opinion on the assumptions?
2) Provided the assumptions are correct, can the court direct the corporation to provide financial data on income, accounts receivable, etc., or is there some other way to compel the corporation to provide this info?
3) Can the fees due the corporation from clients be attached? (I don't know if that's the correct term). In other words, is there a way that I can intercede between the clients and the corporation to collect?
4) As to the individual loan, she has little in the way of personal assets and I have little hope of collecting anything in this direction, so would her subsequent marriage allow me any claim to her husband's assets?

Sorry this was kind of long and drawn out ( I guess I kinda blew rule 2 and sideswiped rule 3 in the big red letters), but if anyone waded through all the above and decides to reply I'll save you some typing - yeah, I know the rules about making loans, this wasn't a good one, but I dun it anyway (some days you have it and some days you don't...)

Thanks in advance for any advice,
wtd
 


JETX

Senior Member
Q1) "An opinion on the assumptions?"
A1) You are correct. You will have two separate cases (one individual, one corporate). And, based on the notation on the check, you shouldn't have a big problem getting the judgment(s), but it depends ENTIRELY on the court.
Suggestion: You could sue in one case and list both parties... Sue Jones, individual, AND Sue Jones Inc.

Q2) "Provided the assumptions are correct, can the court direct the corporation to provide financial data on income, accounts receivable, etc., or is there some other way to compel the corporation to provide this info?"
A2) Some state laws are lenient in the court demanding debtor information as a result of the judgment, some aren't. In any case, I would suggest you consider subpoena'ing these records.

Q3) "Can the fees due the corporation from clients be attached? (I don't know if that's the correct term). In other words, is there a way that I can intercede between the clients and the corporation to collect?"
A3) Yes. Once you have a judgment AND if you know who the account receivable parties are, you can request a garnishment or turnover order from the court to get the due payments sent to the court for disbursal.

Q4) "As to the individual loan, she has little in the way of personal assets and I have little hope of collecting anything in this direction, so would her subsequent marriage allow me any claim to her husband's assets?"
A4) Though Nevada is a community property state, the key here is that this is a 'subsequent' marriage. If the debt was incurred PRIOR to the marriage, it is not communal and liability is not on the 'new' husband.
 

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