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We loaned several thousand to a man to start a business, and he has not made his payments. Is it worth taking to court?

White Salmon, WA |

We don't have the money to pay a lawyer up front- is there a way to pay based on what we can collect from him? My fear is that we would win in court but he wouldn't have any money, and we would be "screwed" and have no money to pay a lawyer. The contract is worth about $13,000.

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Attorney answers 2


Many lawyers work on a contingency fee basis, where the attorney only gets payed if the client recovers damages and the attorney receives a certain percentage of the recovery. You usually see this kind of arrangement in personal injury cases, but if you ask around, you may find a lawyer who is willing to take a breach of contract case on a contingency fee agreement. The amount in controversy is too high for small claims court, so you would need a lawyer to litigate this matter.


I agree withe Mr. Gross and many collection agencies have lawyers on retainer and will work on as collected basis.

Generally speaking this is just some information for creditors.
The key to successful collections is information about a “way to go” from the debtor. The debtor's income stream from wages or contracts needs to be legally intercepted before the debtor gets it, or after the debtor puts the money in the bank. From contractual writs, to bank writs and attachments, to wage garnishments and attachments are normal points in the income stream that may be intercepted, extreme points are forced sale of assets like a sheriff’s sale. Bear in mind that if the debtor is eligible for protection under bankruptcy law that is their “get out of jail free card” and can be played when eligible and you will have to pay back anything that you obtained from 90 days prior. An interesting issues is always the age of the account and fresher is better, when the debt hits the statute of limitations you are done.

Once you have a judgment and you can transcribe the judgment into the jurisdiction where the debtor lives or works you can collect.
If you have a judgment you can conduct supplemental proceedings or a debtor’s examination, or in the alternative, you can send interrogatories to the debtor.

If you suspect the debtor has transferred assets subsequent to your judgment and you can prove it, you have recourse under the Uniform Fraudulent Transfers Act if the act was adopted by your state or the debtor’s state or where the assets are located.

You can turn your account over to licensed and bonded collection agency for about half of the proceeds or hire a collection lawyer to work the account for a time or a percentage.

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