Yesterday, I got a phone call from a person that personally guaranteed a business loan and their bank has filed a lawsuit against them and the business. In today's economy, lawsuits are increasing especially by a person's bank for breach of contract. A breach of contract is a type of claim for non-payment of a contract that was entered into by an individual or a business. Generally, disputes under $30,000 are called municipal cases and disputes over $30,000 are called law division cases.
There are several options available to the Defendant. The first option is to settle the outstanding debt by paying twenty to fifty percent of the outstanding amount. Generally, this is the best strategy, but this is often times impractical. The second option is to file bankruptcy and rid yourself of this debt. The third option is to set up a payment arrangement and prevent a judgment being entered against you. The critical thing here is be realistic with your payment terms. The fourth strategy is to allow a judgment to be entered against you and set up your assets and accounts in a manner where the monies are uncollectable.
Sean Robertson is Managing Partner of Robertson Law Group, LLC, which concentrates in asset protection, civil and commercial litigation, and corporate law. Sean Robertson can be reached at either 630-364-2318 or 312-498-6080.
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