Long time reader here; used to post under another name (SJT). I'm hoping that someone with legal background might have some suggestions.

The last 7 years have been a really wild rollercoaster ride for me... marriage problems (which are fine now-will post on that another day), father dying of lymphoma and leaving us a legal and financial nightmare, extended family doing everything they can to make life a living ******.

When my father died a little over a year ago, he was the executor for his father's will and he had never settled that estate. My father had managed his father's farm since his father had passed away. My father had made it clear to us back around the time that his father had passed away that he had loaned one of his brothers over $22,000 to bail him out of a business problem (unpaid state sales tax). The verbal agreement was that when my father settled their father's estate, he would get my uncle's share as repayment of that loan; they never drew up papers, but a lot of the family knew about it.

In the intervening years my uncle had a few opportunities to repay that money (sold the business, wife got a large injury settlement from the state) but he chose not to repay my father, still insisting that my dad could have his share of the estate. On two occasions prior to my dad dying, this same uncle assured me that if my father died without settling my grandfather's estate that he would still give his share of the estate to my father's children as a repayment of the debt.

So my father dies. Another uncle takes over settling the grandparent's estate. We give it time, and finally when we think that the estate should be close to being settled, we go to the uncle that promised to repay the debt. He says that the loan was repayed long ago, forgetting that he admitted to me that it was never settled. When I call him on that, he makes up another story. We ask for proof of repayment. My uncle says that everything was handled in cash, including the initial loan from my father. (We had bank statements showing my father depositing the money he borrowed to help his brother out, and cancelled checks showing him doling out the money to my uncle.) When we started showing him the checks, he backtracked on the "everything was handled in cash story". Bottom line is, he won't repay. Are we up a creek without a paddle? We have talked to the attorney that is handling my father's estate about this a little. The thing is that we are still paying on the original loan my dad took out to help out his brother; that's why we would like to consider pursuing legal action. <img src="/ubbt/images/graemlins/confused.gif" alt="" /> Any thoughts or suggestions? <img src="/ubbt/images/graemlins/confused.gif" alt="" /> State is PA/Original loan was made in '97-'98.

Thanks.

Bump. Praying that someone might have some insight.

I'm no attorney, but if nothing was written down, I think you are out of luck.

Do you have proof of the original loan, like a promissory note or a repayment agreement or something? If it was verbal, any surviving witnesses?

You may be able to puruse if you have proof that your uncle was loaned the money, and your uncle does not have proof that it was repaid. If you don't have proof of the original loan, yes, you might be out of luck.

Talk to an attorney.

Regards,
rs0522

Most likely not recoverable for a number of reasons including the time that has lapsed, the dollar amount involved and the fact the loan was not in writing. An attorney licensed to practice in your state would best be able to advise you. If you are in Western PA, I could recommend someone... That being said, you might want to call out Mr. W on possible tax implications for your dear uncle....I'm thinking the unrepaid loan becomes a gift and he did not pay a gift tax.......perhaps a tip to the IRS...

Regards,

BB

Ole the good ole days of Estate Settlement.

The evidence you have (the loan documents and the check your father made out to his brother) should be sufficient enough evidence to state a claim. The check itself could be considered the "Loan Document" making it a written contract instead of an oral one (Uncle#1 signed the back...didn't he???).

However, the PA statute of limitations on collecting/enforcing such debt MAY have lapsed. Your attorney's got to figure that out.

So, if possible, your father's estate would be suing your uncle to collect a debt.

Maybe your uncle won't even defend himself in such litigation and in very short order you can obtain a Default Judgement against your uncle. With a judgement in hand your attorney can then file a claim/lien/charging order or whatever they call it in Pennsyvania upon your Uncle's "distributive share" of your Grandfather's estate. It would help if you other Uncle would delay distributing the money until such time as you get such judgment and file such lien. If your other Uncle (the one in charge of the Grandfather's estate) is not on-board with your pursuit of offending Uncle he is likely to just distribute the money to him before you even get the chance to put a lien on it.

Be understanding that Uncle #2 is likely very desirous of settling such matter/Estate and moving on with HIS life.

If offending uncle#1 fights the lawsuit he can likely drag it on for a sufficient length of time that Uncle #2 will have no choice but to settle the estate and distribute the money.

You may still win the lawsuit but be stuck trying to collect forever a judgment. My old firms' got a drawer full of old judgments they have been unable to collect upon. However, with persistence and harrasment they often CAN be collected. Liens on Tax Refunds, garnishment of wages, garishment of bank accounts...someday...you'll get him. But that whole time you'll have to leave your fathers estate open awaiting collection of the judgement (though perhaps the judgement itself can be distributed and assigned to you).

Again, to get the judgment you first must necessarily win the lawsuit.

To Brit/Brats contention: Forgiveness of a debt is Income that your uncle should have reported to the IRS. If your uncle acknowledges the money he got as a "loan" (and as there is no documentation to prove otherwise, hopefully he acknowledges such in court when you sue him)....then the fact he has not claimed the forgiveness of the debt as INCOME on any tax return might bode to prove the debt remains "open account" and perhaps not subject to the statute of limitations. Finally, in negotiations/settlement discussions the fact that he failed to claim such "forgiveness of debt" at any time might present you the opportunity to benignly point out the fact that IRS could be made aware of his understatment of income. Be mindful of "extortion" claims. You can not threaten legal process upon someone to make them pay you. Only your attorney should be trusted to politely point out to opposing counsel the fact that the IRS may be interested in such information. With back taxes and penalties looming he MAY consider settling up with you for a larger amount than otherwise considered.

Finally...one last thought. If Uncle #2 desparately wants to assist in making this right. He KNOWS what you're saying is true. He should discuss the matter with the attorney assisting him with the handling of your grandfather's estate. PERHAPS, just PERHAPS, Uncle #2 could facilitate a distribution from you Grandfather's estate directly to your Fathers Estate. As the Personal Representative of your grandfathers Estate Uncle#2 & his attorney would draft the "Receipt of Distribution" accompanying the check to indicate that the distribution specifically represents payment of a portion or all of Uncle#1's 1998 debt to your Father as evidenced by the old 1998 loan check attached thereto. This MAY opens Uncle#2 up to being sued by Uncle#1, however, if you gave Uncle#2 assurances that the money will be held in your father's estate and escrowed until Uncle#1 could no longer sue, then Uncle#2 may be OK with trying it. Then offending Uncle#1 is forced to hire attorneys and sue his family for the money instead of you.

Quite a reach. But possible.

Sorry about all the legal jargon. Hope you followed my thinking. A whole lotta "ifs" and "may's". If you can at any way come to a settlement with the Uncle...even 50/50 or 40/60....I'd strongly encourage it. You'll end up with more than pursuing him legally considering legal fees, delay, and the headache/heartache. You'll still get to bad mouth him forever.

Good luck,

Mr. Wondering

p.s. - Personal Representative is a Michigan Term for the Executor or Administrator of the Decendents Estate sorry if your State differs and I confused you.

Mr. W,
Thank you so much for replying to my post. You've given me a lot to think about.

As for the statute of limitations.... the lawyer who is handling my father's estate thinks that the statute might have been "reset" when my uncle brought up the debt with me. The lawyer said it might be costly to research that, so we haven't tackled it.

I wish I could go to the uncle that is settling my grandfather's estate and ask him to hold it up, but he is receiving advice from my uncle, the swindler. <img src="/ubbt/images/graemlins/shocked.gif" alt="" /> As it is, settling the estate is being held up because my brother and I have filed a complaint.... you see my uncles and their attorney thought that they had found a loophole to disinherit us from receiving my dad's portion. (When my grandfather's will was last revised, because my dad had a lien that he was in the process of taking care of, my grandfather left my dad's portion in my mom's name, per stirpes. My mom ended up dying before my grandfather, so the uncles attorney ignored the per stirpes and said that our share had lapsed. So now, not only are we out the money that my dad lent his brother, we were also out our inheritance.) Sad family, huh?

Most days, I want to just walk away from this whole mess, because it's divided my brother's and I from my dad's siblings. But we have one other thing to consider... you see, my whole family is plagued with cancer... my dad and all his siblings... and for the last 8 years my one brother, a dear man of God, has been dealing with an inoperable brain tumor. We recently discovered that he uses up his Medicare drug benefits for the entire year by April. He then tries to cut back on anti-seizure and pain meds because he can't afford them. We hoped to have both estates settled so we can give my brother his share while he's on this side of heaven, but it's not happening.

Thanks for your advice and I'll let you know if we make any headway.

Susan

Your "per stirpes" claim sounds legit.

It matters not that your mother was not a lineal descendent of your grandfather...only that you and your siblings remained alive as lineal descendents of your mother. It only would have "lapsed" IF your mother had no kids, you all had died before Grandpa or if she was your step-mother, not related to you by blood (unless, by chance, the Will included step-children in the definition of children).

Man I miss this stuff.

Mr. W

You guys might be able to delay and hold up distribution of the estate long enough to get a judgment against your Uncle for the loan prior to distribution.

Might be worth a shot. Like I said, even if you are late...you can chase him for years trying to collect.

W