thanks for the answer.yes stupidity would be the main problem with someone paying for a loan that they didn't investigate before paying anything.I just wondered what would happen if that situation ever happened to someone.

I think you are assuming such a case involves the fundamental legal principles of equity and estoppel - even if you don't recognize them by their technical names.

Basically, estoppel is a common law doctrine which prevents a party (ie, the debtor) taking a certain course of action and then revoking it after someone else (ie, the lender) has relied on such information or actions and the revocation would be to the latter's detriment.

For example, suppose an insurance adjuster tells you to take your car to a garage for repair after an accident and then the claims manager calls next week to tell you their adjuster made a mistake and you're not covered. Nevertheless, the insurance company would be "estopped" from reneging on the repair even if there was really no coverage. Their agent led you believe you were covered and so the insurer must pay irregardless because of the "vicarious liability" of their agent/employee.

For a more comprehensive explanation, see the Wikipedia article below.

http://en.wikipedia.org/wiki/Estoppel

However, what about the case of a person who admitted a loan and kept on making payments on it, only to realize it wasn't his at some later date? Would the the legal principle of equity and estoppel prevail? (Stupidity certainly would, but that is another matter.)

Contracts can be either verbal or written. Of course, virtually all contracts are written but that still doesn't mean verbal ones are not valid; only that they're more difficult to enforce in court due to the lack of tangible evidence and certainty of terms. The loan creditor, in this case, might argue a valid contract had been created by the verbal admissions of the debtor and also by his actions of making payments.

First, the claimed loan agreement would not have been a valid contract since it lacked the essential elements. One such element is a "genuine intention" (or "exchange of consents" in Quebec). It requires a meeting of the minds of the 2 parties about all material details of the agreement before contracting. Obviously, there was no such thing. Thus any claimed loan agreement by the creditor, verbal or written, would be void from the beginning.

It might appear the creditor could invoke "estoppel" or "equity." Both legal principles involve how a valid contract is interpreted when there is an ambiguity or dispute about the terms. Obviously, it assumes a valid pre-existing contract, which doesn't occur here.

Ray

PS: (The legal principle of "equity" mandates that basic fairness and the reasonable expectations of the parties take priority over the actual details of the contract when their literal interpretation would be so onerous as to violate basic rules of fairness. For an example of what the courts consider "an abuse of right of contract" see the famous case of Banque Nationale du Canada v. Houle, [1991]. It's Quebec Civil Code Law, but it gives you a pretty good idea.)

I have a question on liability Raymond. In a case where someone did admit and make payments on a loan that was not theirs.But down the road realize they made a mistake ,how hard would it be for them to get out of it.Would the fact that they did make payment put them as the owners of that loan because they did pay or could they fight it on the grounds they were mistaken.

1.No, If you really were a "victom of imperonation," then you shouldn't have paid the bill. By doing that you admitted liability. If you really were a
"victom of imperonation," why didn't you contact the police instead? Is it possible that you did cause any of the damage claimed?

2. No, they have no obligation to contact you before sending it to a credit bureau.

Normally, upon termination, a walk through is done with the superintendent or building owner with a checksheet to itemize any damages in excess of normal wear and tear.

However, you can always dispute the billing for any damage claims. The Rent Tribunal or even Small Claims Court would be suspicious of claims for repairs done after the unit was subsequently rented out to other tenants.

Ray

Good Evening, I have a question that i hope someone can answer or shed some light on my stressful day,

I moved out of an apartment at the end of august 2008, Today almost 3+ months later i receive a call from a collection agency On my cell phone and my parents house, Advising that i owe for damage done, I asked for the ledger that they received from the renters, They faxed it to me i dont really agree with the charged, but I did not want to fight it i just wanted it out of my hair, so i made the payment within 5secs, Bank account transfer, and faxed a copy of the receipt.

On the phone when i was talking to the agent, he aid that it already affected my credit and i should pay it immediatly,

He said he had a copy of the Credit report from the Landlord.

1. I was a victom of imperonation(identify theft) are they allowed to supply a credit bureau to a collection agency?

2. Does the creditor(landlord) have an obligation to communicate to me prior to sending it to collections? I undersand that they might not have had my address but they had my phone numbers, as they always called my cell phone they could not remember my house number. + it was on my application(cell phone number)

The collection agency called my cell phone.

I called transunion today and they advised that my credit was fine, and that there was no collection agency / collection account on file.

Is there a time period for it to hit the bureau?

Do i have any options? :) Thanks for your time