The Court of Appeal overturned the verdict for $2.8 million and ruled that the correct amount of the verdict was $2.1 million, or $700,000 less. This was based on the language of the settlement documents. In a 2015 note, we discussed the law on the subject at the time and suggested how to craft an agreement that would withstand challenge. The recent decision in Red & White Distribution, LLC v. Osteroid Enterprises, LLC, 2019 DJDAR 7516 (August 9, 2019), confirms our advice and provides a roadmap. The Rouge-Blanc case involves a debt of US$1.8 million plus interest and legal fees. To resolve the issue, the defendant agreed to make payments totalling $2.1 million, secured by a verdict of $2.8 million. The defendant defaulted and, at the plaintiff`s request, the $2.8 million verdict was recorded. After payment – Once the last payment is made, the creditor agrees to remove all harmful bookings from the debtor`s credit report. The error in the red and white settlement agreement stated that the defendant was “required to pay the [plaintiff] $2,100,000.00 (`Total Payment Plan Amount`) plus interest.” The court is aware of the language required to avoid this problem. “The parties could have included in the agreement terms stating that [the defendant] is required to pay the [plaintiff] $2.8 million, but as long as all payments are made on time in accordance with the payment schedule, the amount due will be discounted to $2.1 million.” Debt settlement. Between the parties, it is presumed that the debtor has an unpaid debt to the creditor.

In the mutual interest of the parties, they agree that such outstanding debt will be marked as paid if the debtor makes the payment from $_ to __ A settlement agreement is a contract. Finally, an appeal decision from California gave clear instructions on how to draft a settlement agreement with payments backed by a decision that will stand in court. A debt settlement agreement is a contract signed between a creditor and a debtor to renegotiate or compromise on a debt. This is usually the case when a person wants to make a final payment for a debt due. The debtor offers a payment below the unpaid due date (usually between 50% and 70%) if the payment can be made immediately. The rule is simple. A penalty for non-payment is not applied, but the loss of a discount for immediate payment is applied. Postal payment. Once the payment has been made by the debtor, the creditor makes every effort to withdraw the unpaid debts of the credit reference agencies.

In addition, the creditor declares that it will not provide any additional information that could harm the debtor`s credit report. Several pieces of information are needed to balance the wording of this Agreement. As a first step, we will bring together the parties who intend to conclude this contract. First, we identify the creditor. That is, the party that holds the debt. Note the legal name of the creditor in the first space of the first paragraph. Then document the creditor`s address with the second empty line. Finally, the third and fourth vacancies require the city and state associated with the creditor`s civic address. Then we identify the debtor. This is the party who is required to pay the debt owed to the creditor. We need to document the same information that is reported about the creditor in the rest of this paragraph.

Find the fifth space in this paragraph and document the debtor`s full name on it. Continue the accounts receivable report with their address, city and country of residence in sixth, seventh and eighth places. Several other areas also require information, starting with “I. Effective Date”. This is the date on which the terms of this Agreement become active or effective. Note the name of the month, the double-digit day, and the year of the first calendar day this contract becomes active. Then, in “II. Current debts”, we need to document the entire current debt that the debtor is required to pay to the creditor. Use the blank line after the dollar sign in this statement to record this amount of money. The third point, “III. Settlement debt”, uses the adjusted amount of debt established for the purposes of this document, which is made available to the white line […].