Question:

One has an agreement which may be renewed on a yearly basis for services rendered and payments are made for those services per the agreement. With the commencement of the initial agreement, a loan (this is the provider’s terminology) of $1000.00 must be made to the provider of service; the receiver of the services does not receive any benefit from the loan. When the agreement is no longer renewed and upon proper presentation of proof of the loan, the loan will be repaid (again the words of the provider of service). Assuming all terms of the agreement as renewed have been met by both sides and upon presentation of proper documentation of the loan to the provider of service, how soon after the presentation of the documentation should one expect the loan to be repaid? If that timeframe is not met, what actions or penalties, if any, would the bas din impose?

Answer:

In the absence of any specified time-frame, this type of loan would be expected to be repaid immediately.

If the provider has a reason for delaying the repayment, the Beis Din would consider it and act accordingly.

If the reason is not acceptable the Beis Din would typically instruct the provider to return the money immediately. If the provider refuses to carry out the ruling of the Beis Din, the Beis Din would typically give permission to take action in Court, with the court costs of the lender being borne by the provider.

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