20 years ago my mother and I signed a note which stated she was loaning me $50,000.00. The note called for no interest, had no due dates for repayment, and stated any unpaid amount on the note would be counted against my share of inheritance. After I received the $50,000.00 check I found out I didn't need it (my insurance company came through), so I sent my mother the check back (i.e. it was never deposited). I believe my mother then threw away the original note. 20 years later my mother dies and my sister, who is the trustee for my mother's estate, finds a copy (not the original) of the note and says that the $50,000.00 courts against my share.
Can she use the copy of the note against me in court? I have not records from 20 years ago, so how do I prove I never got the loan?
The short answer is no she cannot offset the note without the original. The long answer is that if she tries to use the note amount as an offset, you will have to retain a lawyer and file a petition in the probate court to compel her to pay you. I suggest that you speak to a probate/trust lawyer and perhaps retain him/her to contact the trustee and try to work the matter out.
DISCLAIMER: The response herein is not legal advice and does not create an attorney/client relationship or any right of confidentiality between you and the responding attorney. These responses are intended only to provide general information about perceived legal issues within the question. Each state has different laws, each situation is fact specific, and it is impossible to evaluate a legal problem without a comprehensive consultation and review of all the facts and documents at issue. This answer is not a substitute for competent legal advice from a licensed attorney that practices in the subject area in your jurisdiction and who is familiar with your specific facts and all of the circumstances.
She needs the original note to sue you, but the problem is An Offset instead.
if you 2 are to share the net estate equally (50:50), then she is engaging in a self-interested transaction, and can be impeached for bias. But litigating all those issues will take time AND incur substantial Attorney fees.
To prevent the $50,000 offset, you might want to hire a Debtor/Creditor Attorney to explain the rules to her and her Trust settlement Attorney, who works in Probate Court and may be less familiar with the fine points of debt collection laws. So I have changed this post from "Trust" to "Debt settlement" even though there is NO debt. You want to settle the issue.
Your point also is that you never received the money bc you returned the check which means you never cashed it. Without receiving the money, repayment never became due, regardless of what the promissory note said.
An Attorney consultation ~ with candor and confidentiality ~ would result in legal advice that fits the specific situation [facts and documents (if any)].
I agree that the note cannot be offset at this point. But that does not mean your sister will agree. You need to demand that she account for the estate without the note being offset. If she refuses, then you will need to file in court to protect your rights.
Yes. Successor trustee must produce original note or explain absence to sue on the note.
Yes. Successor trustee can offset value of moneys given to you against you beneficial interest in the trust estate.
Must differentiate suit on the note from offset of beneficial interest.
Case presents difficult fact and proof issues. I need more information to opine further. Significant money at stake. Litigation may be expensive. Mediation and settlement may be most cost effective solution. Consult probate counsel.
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