Here is the condensed version of my story. May of 06, I had some pain in my teeth and went to the dentist and found out I needed about $2000 worth of work done. I was in pain in the office at work, boss asked what was wrong, so I told hime about my teth. He said, "I can help you out with that." He then cut me a check for the amount I needed. No verbal or written agreement was made about repayment. I started letting him take $100 out of every check to show my appreciation. After $400 was taken out of my checks, he fired me. About 4 months later he turn me over to a local collection agency. I wrote them a letter disputing the debt and asking for proof of the debt. They sent me a letter written to them by my old boss saying, "I have no proof of debt just the check stubs." Now in April of 08 I have found out that the collection agency is trying to serve me papers for small claims court. How can they sue with no proof of the original debt? I thought it was a gift. Do they have a case at this point? Thanks for any advice. Please note that I haven't been served yet. I just know that someone has tried to do it at my current job, and I called the court to find all this out.

Here is the condensed version of my story. May of 06, I had some pain in my teeth and went to the dentist and found out I needed about $2000 worth of work done. I was in pain in the office at work, boss asked what was wrong, so I told hime about my teth. He said, "I can help you out with that." He then cut me a check for the amount I needed. No verbal or written agreement was made about repayment. I started letting him take $100 out of every check to show my appreciation. After $400 was taken out of my checks, he fired me. About 4 months later he turn me over to a local collection agency. I wrote them a letter disputing the debt and asking for proof of the debt. They sent me a letter written to them by my old boss saying, "I have no proof of debt just the check stubs." Now in April of 08 I have found out that the collection agency is trying to serve me papers for small claims court. How can they sue with no proof of the original debt? I thought it was a gift. Do they have a case at this point? Thanks for any advice. Please note that I haven't been served yet. I just know that someone has tried to do it at my current job, and I called the court to find all this out.


Your "I thought it was a gift" defense went out the window when you starting paying the money back. I don't understand why your former boss doesn't think he has proof of the debt when he has the cancelled check and a record of payments but that's his problem.

The other argument will be - unless you had a personal relationship with your boss - why would you get a $2,000 "gift" - which you then began to pay back.

No, I don't think you have a defense and I think you are going to look, at best, ungrateful in Court.

I'm surprised in your area - what State? - that they do personal service for Small Claims Court. In my area it's by mail. I'm also surprised that someone told you that the boss said there is no proof - very surprised, indeed.

It is not a gift.. it's a loan.

The proof is you allowed $400 deducted from your pay check.

You had the dental work done. The boss paid the dentist for your dental work. You had $400 deducted from your pay. Why do you think you don't have to pay this back to the boss? This was not considered a gift. Sounds like you're going to try and stiff someone who was kind enough to help you out. If boss is smart he will have the proof he needs to collect this money from you. The reason he turned it over to a collection agency is obvious. He doesn't want to deal with you any more about this debt - he just would like you to repay him. What's wrong with that? Avoiding service of the papers is not going to help you either way. It's just prolonging the process.

Respond to the collection agency, in writing, that, as there is no proof of the debt, it is therefore invalid, you will not be making any payments towards it and you consider the matter closed. Keep a copy of the letter. If you do end up in court, take the letter with you and tell the judge the same thing.

Sounds like you're going to try and stiff someone who was kind enough to help you out.And this same someone was also "kind" enough to fire her. I'll admit it seems highly irregular that a boss would be nice enough to "lend' an employee $2000 for dental work, then 4 months later turn around and fire that same person. I know that that's getting a bit off topic but if I were in the OP's shoes I certainly wouldn't just fork over the balance of this "debt" to a boss who fired me without making him/her fight to the death for it. After all, the boss could've just kept the OP working for him/her until the full $2000 had been deducted from her paycheck, then do the firing. That would've been the easiest and most sensible thing if this boss is really so hell-bent on getting his/her money back.

And this same someone was also "kind" enough to fire her. I'll admit it seems highly irregular that a boss would be nice enough to "lend' an employee $2000 for dental work, then 4 months later turn around and fire that same person. I know that that's getting a bit off topic but if I were in the OP's shoes I certainly wouldn't just fork over the balance of this "debt" to a boss who fired me without making him/her fight to the death for it. After all, the boss could've just kept the OP working for him/her until the full $2000 had been deducted from her paycheck, then do the firing. That would've been the easiest and most sensible thing if this boss is really so hell-bent on getting his/her money back.



Got to disagree with you on this one - no need to retain an employee who is no longer working out for the company (for whatever reason) simply because that person owes the employer money.

I think that the deductions indicate this was a debt, not a gift and the second "gift" argument is why would the employer give an employee a $2,000 gift - followed by a termination. Apparently there was no protest when the deductions were made from the paycheck.

In my opinion the evidence is on the side of the employer.

Hope the OP comes back and lets us know how it works out.

I'm also surprised that someone told you that the boss said there is no proof - very surprised, indeed.


No one told me that the boos said that there is no proof of debt. I have a handwritten letter from the boss saying that he has no proof of debt.

Apparently there was no protest when the deductions were made from the paycheck


Sorry about the timline confusion here. Of course I didn't protest the paycheck deductions, they were my idea. I approached him with the deduction idea two months after the work was done. I am not trying to stiff anyone. He never asked for the money back. I never signed anything saying I was going to pay it back. I offered to repay him for his kindness. I would have continiued paying him to, but I was out of work for 3 months after he fired me and then it took us 6 months to get back on our feet after that. It's not that I didn't want to pay him back, I couldn't. Since there was never a "loan" agreement between us, I didn't think it would be a problem. He never even asked for a payment after I was fired either. Just a letter 4 months later from a collections agency.

Sorry about the timline confusion here. Of course I didn't protest the paycheck deductions, they were my idea. I approached him with the deduction idea two months after the work was done. I am not trying to stiff anyone. He never asked for the money back. I never signed anything saying I was going to pay it back. I offered to repay him for his kindness. I would have continiued paying him to, but I was out of work for 3 months after he fired me and then it took us 6 months to get back on our feet after that. It's not that I didn't want to pay him back, I couldn't. Since there was never a "loan" agreement between us, I didn't think it would be a problem. He never even asked for a payment after I was fired either. Just a letter 4 months later from a collections agency.


I am going to paraphrase excon here (from another post). With apologies to excon who said it first AND better:

YOU: He has no proof it's a loan.

ME: Yes, he does. You made payments. It's a loan.

YOU: No, it's not, he doesn't have any proof.

ME: It's a loan, you made payments and it's my opinion you will lose in Court.

YOU: There was no loan agreement between us and he fired me and I was out of work for 3 months and it took me 6 months to get back on my feet. In only "REPAID" him for his kindness. It was not a loan.

ME: It was a loan. Inability to pay is not an excuse. Your employer had no duty to employ you if for whatever reason you were replaceable. You have made payments. In my opinion you will lose in Court.

Debate over for me. You asked for an opinion based on experience. I gave it to you. So wait until you get served, go to Court and let "us" know how you make out.

He apparently turned this over to a collection agency so he could balance his company's books with the debt. The collection agency is certainly going to have to work to get the money from you. I have seen such scenerios happen in offices over and over again. Boss lends employee money. Employee does not pay back money loaned. Employee either quits or gets fired. Boss stuck holding the bag. You could have been fired due to the economy and the company not needing your position any longer. If you received the benefit of the 2K for much needed dental work, you should start paying something to the boss in good faith regardless if it is $10 a week toward the debt. I am sure you can spare $10 a week until you can start making larger payments for this debt.

So you're say I screwed myself by offering to pay it back. I have been served and I plan on requesting a trial. I will definitely let you know how it works out.

So you're say I screwed myself by offering to pay it back. I have been served and I plan on requesting a trial. I will definately let you know how it works out.


Yep, I said it several times, in fact. Keep us informed - if you are lucky you will prove me wrong.

If there was no set payment schedule, then inability to pay is a valid justification. Tell the credit agency you can make whatever monthly payment you feel comfortable with. The reality is that even if they take you to court, the judge would probably order a payment plan anyway as this is not a secure, contractual debt.

Hey again. I went to the collection agency after being served and asked for all the proof of debt the had on the case. They gave me an invoice for $254.00. I asked them about the other 3 grand they were coming after me for and they said that would contact the client and get a hold of me. The called me a week later and said that they could not get a response from the client and that they were suspending the court case until they could get a hold of him. After a month the called me back and settled for the amount of the invoice and closed the case. I hope this is the last I hear about this, but I'm pretty sure it isn't. Thanks for all the advice.

Hey again. I went to the collection agency after being served and asked for all the proof of debt the had on the case. They gave me an invoice for $254.00. I asked them about the other 3 grand they were coming after me for and they said that would contact the client and get a hold of me. The called me a week later and said that they could not get a response from the client and that they were suspending the court case untill they could get a hold of him. After a month the called me back and settled for the amount of the invoice and closed the case. I hope this is the last I hear about this, but I'm pretty sure it isn't. Thanks for all the advice.


Thanks for coming back and keeping us informed - I'll be curious to see what happens next. For your sake, maybe nothing - !

Just make sure you have a copy of the invoice marked paid in full.