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About 5 years ago I received $10,000 to start a business and purchase some equipment for the business. I understood it to be a gift from a generous friend and entrepreneur who had taken me under his wing. He is very well off and has the means to do something like this. We never formalized anything in writing and when I mentioned giving him an interest in the company he said that he wanted nothing in return except to see me succeed. He wanted to give me an opportunity. Fastforward to more present times, the business didn't work out and I ended up having to sell some of the equipment. I contacted him repeatedly over many months out of courtesy to see if he wanted any of the profit from the equipment. I never heard back from him. I sold the equipment because I had a willing and able buyer ready to go and I collected the profit. The money has since been used up. I was unemployed for a short while and I used some of the money to pay off student loans. Now he and his wife have come out of the blue and are calling me a fraud and a jerk when they found out the equipment had been sold and they were not going to be able to get their money back. Do they have a cause of action action me? What can I expect them to do legally? What would my best course of action be if they try to pursue legal action against me? This is obviously very upsetting to me because I don't want this to turn into anything serious or have to engage in legal proceedings if there is a way around that.
No written agreement that stated that I had to repay the $10,000
No oral agreement either.
I understood it to be a gift with no strings attached.
I never repayed any of the money to them.
It has been around five years since the money was received by me.
I can't thank you enough. Have a great evening!