Q&As

Two people were previously in a long-term cohabiting relationship and one party loaned money to the other party which was not repaid. There is no written documentation in respect of the loan agreement. What action can be taken to recover the monies loaned and what factors will be taken into account by the court?

read titleRead full title
Produced in partnership with Chris Bryden of 4 King’s Bench Walk
Published on LexisPSL on 30/04/2020

The following Family Q&A produced in partnership with Chris Bryden of 4 King’s Bench Walk provides comprehensive and up to date legal information covering:

  • Two people were previously in a long-term cohabiting relationship and one party loaned money to the other party which was not repaid. There is no written documentation in respect of the loan agreement. What action can be taken to recover the monies loaned and what factors will be taken into account by the court?

Where a person loans money to another person, that money is recoverable by way of an action in debt. Where there is a formal loan agreement, it may contain terms in respect of repayment and default, as well as provisions in respect of interest, security, demands, etc. However, where a loan of money is made to a cohabitant, in many cases, it will not be reduced to writing but rather will amount to an informal agreement that the money will be repaid at some date or event in the future, or on demand.

Prior to issuing proceedings, it is important to seek to resolve the issue informally if at all possible. This may include a written demand for repayment. If this cannot be achieved, the Pre-Action Protocol for Debt Claims should be followed. This involves the sending of a letter of claim setting out the nature of the debt. If this does not lead to pay

Related documents:

Popular documents