About 3 years ago. I signed a promissory note from a friend who owned his own business to help me start up a business that he thought would be good for me. Our relationship dissolved almost three months after the promissory note was drafted. I have not heard from them until I received a letter from them in the mail, demanding full payment by March of 2007 or it will be referred to an attorney. I am a little unsure of how I should handle this... my questions are:

1) In the state of Florida, is it required that both parties sign the promissory note?
2) I have no assets nor am I employed at this moment. I am currently in school.
3) What can he do if it does go to an attorney?
4) Can I propose other payment arrangements being that I cannot make full restitution to him and can I combine this debt on a Consolidation program?
5) I am not trying to dodge the debt first if it is even legal and if it is what can I do to avoid court.

Are you the co-signor or primary?

The Primary... there is no co-signer.

Since you are the only one on the promissory note, try to make arrangements to pay it.

You may make a offer to make payments, ( which should be good enough, but you don't know) If you signed the loan, it would be a legal loan.
Even if you did not sign, if you made a verbal agreement and took the money it still have a legal standing, just harder to prove.

If he takes you to court, he will get a judgement, he can seize or attach all of your bank accounts, and garnish your pay if you get any.
This may not sound like much now, but in a few years after you finish school, a judgement showing up can effect your employment if some companies what a clear credit history to hire you. And it will allow him years from now, to still garnish your pay when you do go to work.

So working out a payment plan should be the idea thing.