If someone let me have money without any agreement to pay it back, can that person later demand that I pay the money back?

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If someone let me have money without any agreement to pay it back, can that person later demand that I pay the money back?

A friend gave me money over the past few years. t was always an understanding that they were gifts and never an agreement to pay the money back. Now, he is demanding that I re-pay all of the money. This comes as a huge shock for me. Do I have a legal obligation to pay the money back? Could he really have a case against me?

Asked on March 26, 2012 under Bankruptcy Law, Georgia

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

A loan must be repaid as per its terms; a gift does not have to be repaid. If you and the other person disagree about whether it was a gift or a loan--and the important thing is, what was it considered at the time it was made?--then he could try to sue you for the alleged repayment you owe. It's almost a given that he could at least file and bring a lawsuit if so inclined; whether he could prevail will depend on the evidence and believability on each side--that is, for example, could he convince a court that it was a loan? If he is suing you, the burden of proof would be on him; that is, he would have to be able to prove, such as by testimony or otherwise, by a "preponderance of the evidence" that the money had been a loan, not a gift. That means he'd have to convince the court it was "more likely than not" that the money was a loan.


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