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Promissory Note – Loan claims

Promissory Note claims in Small Claims Court

A promissory note is a contract specifying the terms of a promise by one party called the maker, to pay a sum of money to the other party, called the payee. Promissory note is intended to be a legal contractual obligation obligating the borrower to pay back a loan. Promissory note is some sort of security that can somehow ensure the person to whom it was issued, that payment in the same amount shall be paid at a definite period of time in the future. Whereas a promissory note is evidence of a loan, it is not the loan contract, which would contain all the terms and conditions of the loan agreement

Generally, a promissory note includes the following:

the principal amount
the interest rate (if any)
the date
the names of the parties
the term of repayment (it can be for a specified fixed length of time or payable “on demand” whenever the lender demands repayment of the amount loaned to the borrower)
any terms regarding the right to pre-pay the loan before the maturity date
what happens if the borrower misses a payment or fails to pay when payment is demanded

Secured Promissory Note usually includes a clause that states that the borrower may pay back the loan before the required date. Attached to the secured promissory note is the security agreement, which specifies the collateral that the borrower is offering.

Unsecured Promissory Note doesn’t have the security agreement, and are more frequently seen between relatives or friends.

Often, having a promissory note and collecting money on that promissory note are two different things. You might want to file a claim for Promissory Note in small claims court.The number of steps in a Small Claims Court proceedings varies from case to case.

Time Limits: There may be a time limit on how long you can wait before making a claim in Small Claims Court, which is set out in the Limitations Act. Under the law, the time you have to sue may run out. The deadlines vary depending on the circumstances of the case, and the type of case or claim. Check the time limits for your type of case. If you aren’t sure about whether you are still in time to make a claim, Contact US.

The following steps will have to be taken for your Promissory Note case in Small Claims Court:

Completing the Plaintiff’s Claim form
Deciding which Small Claims Court office to go to
Preparing all documents and evidences that can support your case
Filing the claim
Paying Small Claims Court fees
Serving the Plaintiff’s Claim
Affidavit of Service

If you have filed a claim and the defendant has not filed a Defence within 20 days, you can ask the court clerk to note the defendant in default. You do this by filing a Request to Clerk form. When a defendant has been noted in default you can ask the court to order them to pay money to you. This can be done by:

Asking the court clerk to sign default judgment for a specified sum of money for that you must fill out and file a Default Judgment form; or
Asking a judge to order default judgment. To do this, you file a Notice of Motion and Supporting Affidavit form. Explain the facts supporting your motion.

If it is a defended small court procedure, a mandatory settlement conference is scheduled – a settlement conference is an opportunity for parties to attempt to mutually settle the matter with the assistance of a Judge,failing so; than the matter is to be set down for trial.

Our Paralegal’s Defend Your Rights in Small Claims Court

Learn more by contacting us, to see how we can help you with a no-fee consultation.

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