How Can I Get My Money Back That I Gave to my Friend to Run His Business?

Ararat on 03/03/2018 - 03:03
Last edited 03/03/2018 - 09:20 by 1 other user

Hi Guys.

It's bothering me a lot, for so long recently. One of my friends borrowed large sum of money ($125 k) from me to run his business nearly two years before. He gave me 5 signed open bank cheque to me for my security. He promised me that he will give some money each month from his Business profit. He gave me small % for some time about one year from his profit and now he is not paying since 6 months.

When I call his mobile he refused to take my calls and not willing to face me to sort this matter amicably. I requested him to pay back all my money three months before since he stopped paying me business profit. He is not ready to talk to me. I don't want to go to his house and ask him because of the other family members with children. I don't know how would I get my money back. Am I able to take any legal actions? I can't trust him anymore? It's my hard earned money and my savings?

Financial

Comments

  • follow on 03/03/2018 - 03:16
    +4

    do you have a contract?

    • poboy on 03/03/2018 - 08:45
      +17

      $125k loan with no contract… What could go wrong?

    • Ararat on 03/03/2018 - 22:09

      No contracts done but he gave me signed 5 bank cheques worth 25 k each.

      • follow on 03/03/2018 - 22:21
        +1

        Ouch

      • follow on 04/03/2018 - 00:07
        +2

        why dont you cash the cheques?

  • itsdougie on 03/03/2018 - 03:18

    Is your friend still turning over a profit?

    • Ararat on 03/03/2018 - 22:19

      My friend started few businesses like restaurant,financial foreign money transfer agency in his own name and now he is doing some building contracts.But he didn’t sustain in any business.He keeps on changing the businesses that triggered my suspicious.Recently when I give more pressure to return the money he replied his business not thriving much.

  • garetz on 03/03/2018 - 04:29
    +20

    if any situation calls for bikies, this is it.

  • whooah1979 on 03/03/2018 - 05:52

    One of My friend borrowed large sum of money ($125 k)

    Was this seed money with conditions like a share of the profits?

    • Ararat on 03/03/2018 - 22:22

      The money 125 k is our family savings since 12 yrs.We gave him from our savings.

  • watwatwat on 03/03/2018 - 06:11
    +10

    "I don't want to go to his house and ask him" - you'll never see that money again.

  • TheBilly on 03/03/2018 - 06:16
    +5

    Unlikely you will get it back with out legal action, and if I were you I would go and see a good lawyer right now/today. Because if your "friend" is about to go broke, I can sure as tell you there will be a line of people and companies chasing money and you will be the last to get paid. Go and see a lawyer now and start your legal action ASAP, it might already be to late if he is filing for administration etc.

    • Ararat on 03/03/2018 - 22:29

      Can you please explain what is filing for administration means?

      • Quantumcat on 03/03/2018 - 22:43

        Going bankrupt and having your assets sold to pay off your creditors

  • iratepirate on 03/03/2018 - 08:06
    +5

    That's a very expensive way to get rid of someone you don't want to be friends with anymore.

  • JIMB0 on 03/03/2018 - 09:09

    Would he have the money in the account the checks would be drawn from?

    • Ararat on 03/03/2018 - 22:33

      I have the signed cheques with me,can I go to my bank and request the deposit by submitting those cheques. I am wondering if there is no money in his account,will I get in to trouble?

  • foxmulder on 03/03/2018 - 10:31
    +5

    Lending friend a large money will ruin friendship. No money should be involved in friendship. That's what bank for. Don't Kno if your friend business is doing well, if it does ask him to go to bank to open a loan to pay you back.

  • PcisT on 03/03/2018 - 10:40
    +1

    He's probably not making money anymore, and/or debt.

    • Ararat on 03/03/2018 - 22:40

      When I gave pressure to pay me back recently he opened a new story saying that his business bank account transactions were blocked by the bank authorities and it was under investigation.But I doubt his reason for not paying back.How can I ratify his statement of reasons? Is there any chance I can check the validity of his statement.

  • kipps on 03/03/2018 - 12:49
    +2

    What do you mean signed open bank cheque? A bank cheque is drawn on the bank and they won’t leave them blank. A personal cheque can bounce. However if you draw the cheque for $125k and it bounces then you will have a very simple action in debt for the bounced cheque (easier than proving an action for the actual advance itself).

    The cheque might have gone stale by now though.

    • Ararat on 03/03/2018 - 22:47

      It is his personal Bank cheques 25 k each signed and post dated on the top on different dates.
      I didn’t understand your response from If I draw the cheques it bounces and then a very simple action in dept.
      What do you mean by cheques gone stale by now?

      • nowinnofee on 04/03/2018 - 13:16
        +3

        what kipps is saying:

        1. Bank Cheques are cheques which are drawn by the bank, and not by an individual. It will say "Bank Cheque" on the actual cheque. You can go into a bank to buy a bank cheque. At the time of purchase, the bank will deduct the amount on the cheque plus bank fees from the person's account, that money then sits in the bank's special account awaiting someone to cash-in the cheque. A bank cheque is equivalent to the bank acting as a trustee for that money pending it being cashed. What you have described is not a bank cheque but a "Personal Cheque". Unlike a bank cheque, the money stated on the bank is not guaranteed by the bank. Instead, the money is only drawn from the person's account when the cheque is cashed. Therefore, with this kind of money, you should always ask for a bank cheque or a bank guarantee, rather than a personal cheque.

        2. Simple Debt Action: normally to sue on a debt, you need something in writing - i.e. a loan agreement or a securities agreement. From your comments above, you have neither. However, what you do have is personal cheques from your friend. You could attempt to cash the personal cheques and if there is insufficient funds in your friends account, then the cheques will bounce. Provided that you can prove in court that you had came to the cheque by proper means (i.e. the cheques are original cheques, signed by the account bearer on the date of those cheques and you can prove that you are the payee stated on the cheques), then you can sue your friend for the amounts stated on the bounced cheques. A cheque is an unconditional order in writing from the payer to his/her bank to pay the amount stated on presentation of the cheque by the payee. It is akin to a deed poll, which is signed, sealed and delivered. The bouncing of the cheque means that your friend has defaulted on his/her covenant under that instrument, and you can sue for that default. You will need to see a lawyer about enforcing your rights under the cheques.

        3. Stale Cheques: all cheques have a Use-By date. In Australia, cheques become stale after 15 months from the date stated on the cheques. A bank is not required to honour a stale cheque. This means that depending on dates on those cheques you are holding, they may not be worth the paper they are written on.

        • Ararat on 05/03/2018 - 00:04

          Thanks nowinnofee for details of explaining.I checked my Chequers it’s all post dated in March.That means I can withdraw those personal cheques from that dates written on them? Those personal cheques issued to me not by written my name on it but written ‘cash only ‘ and signature and name of his business on it.

        • bluedufflecoat on 05/03/2018 - 21:50
          +1

          @benhil:

          It's pretty useless if there is no money in his account to draw from.

  • try2bhelpful on 03/03/2018 - 14:10
    +1

    If you don't have a contract I'm not sure there is much you can do about getting the money back. Sounds like your "friend" has stiffed you. You can ring him and leave a message threatening you will start civil proceedings, but without any form of documentation I don't think there is much you can do. Do you have any form of emails, etc where you discuss what you intended to do, it might add some weight?

  • dcep on 03/03/2018 - 15:54
    +3

    next time you should've asked for 10 signed open cheques for $250k

    seriously, it's a gone case .. even if you lawyered up.

  • grasstown on 03/03/2018 - 17:51
    +1

    Was the loan electronic?
    Were the repayments electronic?
    I would think any repayments are good evidence that the money was a loan and not a gift. The holding of the blank cheques is evidence. And then there is the credibility of your word against your friends. But your friend may come up with a believable story too. As someone alluded to above, perhaps your friend will say you were an investor in your friends business taking a share of profits. A lawyer could tell you your options. And then there is the issue of whether your friend can repay you if you win. You Would then need to take enforcement action.

    • Ararat on 03/03/2018 - 23:00

      I transferred mostly by electronic transactions and he paid back to me electronically his portion of his profit every now and then.But he mentioned the term “Loan” some of his electronic transactions to me.
      I have 5 post dated cheques and the dates written for future dates which is April 2018.

  • Toons on 03/03/2018 - 22:32
    +2

    Park in the Driveway of his business that way he has to talk to you.

    You have 5 cheques written out to collect 25k a pop time to cash them in and let the debt collectors chase him for it.

    You also have a history of him paying you back money on regular intervals.

    Thats the leverage you have proof the money was intended as a loan.

    If it went to court he would have to explain both points under oath

    • Ararat on 12/03/2018 - 11:48

      Can I go to the bank and check the genuineness of his post dated cheques before cash them out in due dates?

      • Toons on 12/03/2018 - 20:19

        no idear but they might tell you if they are nothing more than than bookmarks

  • popcornready on 04/03/2018 - 12:33
    +4

    The problem with court is that if the friend has no money, he may be ordered to repay a small sum a month ($100).

    Alternatively, the courts find that no contract existed.

    My theory, and it’s too late for the OP, is to never lend to friends or family with the expectations of having the money returned.

    • Ararat on 12/03/2018 - 11:45

      If he have enough money to pay back,will the court order him to pay my money back full?
      Because he told me once he got some properties here and abroad.
      Once he told me if something goes wrong he will sell them and return my money back.

  • shaybisc on 04/03/2018 - 13:30
    +2

    The reason he borrowed off you is because nobody who cares about getting their money back would give him a loan.

    • Ararat on 12/03/2018 - 11:42

      Once he told me that he rotate some money by giving for interest to different peoples when I requested to return my money back.So I started suspecting him from that moment and decided not to do business with him.

  • Seraphin7 on 05/03/2018 - 19:53
    +1

    One way or another, you've seen the last of your $125k.

    • Ararat on 12/03/2018 - 11:38

      I still have trust on him and will get back my money one or other way because I have trusted other friends support who knows him very well.I have evidence of electronic transactions to his account.He return some profits to me some time before by deposit to my account by e transactions.

  • Wantone on 08/03/2018 - 09:54
    +1

    You're a good friend with a good heart for trusting someone this much, but this is where nice guys can get taken advantage. Bring out your assertiveness and face him because being nice or conservative now will get you no where with him.

    • Ararat on 12/03/2018 - 11:34

      This is my first experience with trusted friend who treated me like these.I learned lessons with expensive if I can’t get money back.I still trust him and call him every day for his response.But he doesn’t respond but occasionally I get reply saying that he lost his phone or will call later.

  • redvaldez on 08/03/2018 - 10:39
    +2

    Given how he's treated you so far, do you really expect he'll just turn around and pay it just because you leave the occasional message on his phone? You need to get serious. I would be speaking to a lawyer as soon as possible. It may not be worthwhile taking it further, but given the amount of money at stake, I think you'd be crazy not to get professional advice.

    • Ararat on 12/03/2018 - 11:30

      He treated me so for by not respecting my phone calls or texts.Frequently changes his phone number and not giving the clue to me about his contact.I already sent him messages to all phone numbers about going to deposit his cheques to cash out after March.But no reply until now.I going to seek lawyers for legal assistance now.

  • Ararat on 12/03/2018 - 11:23

    What kind of lawyer I should look for to discuss this issue.Do we have any specialist lawyer who deal with these type of cases out there.Any suggestion from ozbargain community?

    • JohnnyB.Cheap on 12/03/2018 - 14:54

      Doesn't matter, any lawyer will take this case given how foolhardy you are with your money. They'll ring another $10k out of you and call it a day. From my memory of revenue law in uni. You gave him the money, you didn't loan it. You best bet is to sue him for not honoring the cheques he gave you.

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