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TexLaw, Attorney
Category: Legal
Satisfied Customers: 4430
Experience:  Lead trial/International commercial attorney licensed 11 yrs
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I lent a friend $3,000 and then later she bought $15,000 of

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I lent a friend $3,000 and then later she bought $15,000 of products from me but never paid for them. We are both in the fund raising business, doing fund raising for non profits with coupon books. I supplied her with the coupon books and other product to sell and now she won't pay for them.How do I collect?

Thank you for using JustAnswer.

It appears to me that you have two separate issues. The first issue is that you let your friend borrow $3,000.00 that she has not repaid. The second issue is that she took $15,000.00 on consignment from you to sell and then has either converted the property, or kept the money for herself and used it for something else. On both of these issues, she is refusing to pay.

You have a breach of an oral loan agreement. You can sue your friend in small claims court on this oral loan agreement. You need to gather evidence, such as any writing which would demonstrate an acknowledgement of the debt.

The second issue is a breach of contract claim. Because it is for $15,000.00, you will have to bring the claim in county or district court. County court is less expensive. You don't have to have an attorney to bring the claim, but the rules of evidence do apply and there is a formal pleading requirement that might be hard to handle for the unexperienced. It might be a good idea to hire a local attorney on the $15,000 claim.

Before you start though, you need to send her certified demand letters stating that if she does not pay you within a certain time, then you are going to take legal action. The fact that she claims she can't afford to pay you is not good. It may indicate that she truly doesn't have the money to pay. In which case, a judgment will be pointless because you can't collect. so another thing you can do is investigate to see if she has any assets or a job, etc.

Finally, the fact that she refused to turn over money to a Non-profit is also potentially criminal embezzlement. You should tell her that she either needs to pay up or you are going to press charges. Don't put this in your demand letter though (important to not include it).

Please let me know if you need any clarification.

Best regards,
Zachary D. Norris
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