In which state should I sue a debtor to collect on a promissory note ifI live in one state and the debtor lives in another?

UPDATED: Jun 20, 2011

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In which state should I sue a debtor to collect on a promissory note ifI live in one state and the debtor lives in another?

I live in CA; debtor lives in TX. Terms of the promissory note state it will be “interpreted under the laws of CA”. I’m concerned that if sued in CA, and I receive a favorable ruling (e.g. lien on real property, attachment of wages, etc.), it may not be enforceable in TX. I’d prefer to file suit in CA because it’s my home state.

Asked on June 20, 2011 under Bankruptcy Law, California


FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

The basic question for suing the person who has not paid on the promissory note is where was the promissory note signed and where was the obligation entered into, California or Texas?

The term "interpreted under the laws of CA" stated in your question suggests that the contract on the promissory note was entered by the person who owes you money in California and if so, filing suit in the State of California would appear to be the way to go.

The problem with any lawsuit is two fold. First getting a judgment and second, collecting upon it. Does the person who owes you money have real property or other assets in the State of California or is all that he or she owns in Texas? If there are assets in California belonging to the person owing money to you, you have a better chance of getting payment on any judgment you might get.

Regarding enforceability of a California judgment in the State of Texas, you would have to do further research if Texas would honor a California judgment. Good luck in getting money owed you.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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