debt

A sum of money due by certain and express agreement. A specified sum of money owing to one person from another, including not only obligation of debtor to pay but right of creditor to receive and enforce payment. State v. Ducey, 25 Ohio App.2d 50, 266 N.E.2d 233, 235.

Liability on a claim. Bankruptcy Code No. 101.

A fixed and certain obligation to pay money or some other valuable thing or things, either in the present or in the future. In a still more general sense, that which is due from one person to another, whether money, goods, or services. In a broad sense, any duty to respond to another in money, labor, or service; it may even mean a moral or honorary obligation, unenforceable by legal action. Also, sometimes an aggregate of separate debts, or the total sum of the existing claims against a person or company. Thus we speak of the "national debt", the "bonded debt" of a corporation, etc.

Common-law action.

The name of a common-law action which lies to recover a certain specific sum of money, or a sum that can readily be reduced to a certainty. It is thus distinguished from assumpsit, which lies as well where the sum due is uncertain as where it is certain, and from covenant, which lies only upon contracts evidenced in a certain manner. It is said to lie in the debet and detinet (when it is stated that the defendant owes and detains), or in the detinet (when it is stated merely that he detains). Debt in the detinet for goods differs from detinue, because it is not essential in this action, as in detinue, that the specific property in the goods should have been vested in the plaintiff at the time the action is brought.

@ active debt

One due to a person. Used in the civil law.

@ ancestral debt

One of an ancestor which the law compels the heir to pay.

@ bad debt

Uncollectible account receivable. Under National Bank Act, an unsecured debt on which interest or payment is past due for at least six months.

+ bad debt

A debt which is uncollectible; a permissible deduction for tax purposes in arriving at taxable income. I.R.C. No. 166.

Different tax treatment is afforded business and non-business bad debts.

A business debt is defined by the Internal Revenue Code as a debt created or acquired in connection with a trade or business of the taxpayer, or a debt which becomes worthless in the taxpayer's trade or business.

Loans between related parties (family members) generally are classified as nonbusiness. A deduction is permitted if a business account receivable subsequently becomes worthless providing the income arising from the debt was previously included in income. The deduction is allowed only in the year of worthlessness

- bad debt reserve;

- bonded debt

@ convertible debt

Debt which may be changed or converted by creditor into another form of security, e.g. shares of stock.

See debenture (convertible debenture)

+ convertible debt

A bond or debenture or note which under certain conditions and at certain times may be converted into stock by the holder.

See convertible securities

@ debt by simple contract

A debt or demand founded upon a verbal or implied contract, or upon any written agreement that is not under seal

@ debt by specialty

@ debt by special contract

A debt due, or acknowledged to be due, by some deed or instrument under seal; as a deed of covenant or sale, a lease reserving rent, or a bond or obligation. 2 Bl.Comm. 465

@ debt of record

A debt which appears to be due by the evidence of a court of record, as by a judgment or recognizance. 2 Bl.Comm. 465.

@ fraudulent debt

A debt created by fraud. Such a debt implies confidence and deception. It implies that it arose out of a contract, express or implied, and that fraudulent practices were employed by the debtor, by which the creditor was defrauded.

@ hypothecary debt

One which is a lien upon an estate.

@ installment debt

Debt which is to be repaid in installments; e.g. retail installment contract.

@ legal debts

Those that are recoverable in a court of law, as debt on a bill of exchange, a bond, or a simple contract.

@ liquid debt

One which is immediately and unconditionally due.

See also liquidated debt.

+ liquid debt

/likwad det/ A debt immediately and unconditionally due.

@ mutual debts

Money due on both sides between two persons. Such debts must be due to and from same persons in same capacity. Cross debts in the same capacity and right, and of the same kind and quality.

@ passive debt

A debt upon which, by agreement between the debtor and creditor, no interest is payable, as distinguished from active debt; i.e., a debt upon which interest is payable. As used in another sense, a debt is "active" or "passive" according as the person of the creditor or debtor is regarded; a passive debt being that which a man owes; an active debt that which is owing to him.

In this meaning every debt is both active and passive; active as regards the creditor, passive as regards the debtor.

@ privileged debt

One which is to be paid before others in case a debtor is insolvent; e.g. secured debt.

@

- proof of debt

@ public debt

That which is due or owing by the government of a state or nation.

@ secured debt

Debt secured by collateral; e.g. by mortgage, securities, deed, etc.

See secured transaction.

@ simple contract debt

At common law, one where the contract upon which the obligation arises is neither ascertained by matter of record nor yet by deed or special instrument, but by mere oral evidence the most simple of any, or by notes unsealed, which are capable of a more easy proof, and therefore only better than a verbal promise. 2 Bl.Comm. 466.

@

- specialty debt (See also debt by specialty or debt by special contract)

@ debt adjusting

Engagement in the business of making contracts, express or implied, with a debtor whereby the debtor agrees to pay a certain amount of money periodically to the person engaging in the debt adjusting business who shall for a consideration distribute the same among certain specified creditors.

See also debt adjustment

- debt pooling

- wage earner's plan

@ debt adjustment

Settlement of dispute regarding debt obligation by compromise and adjustment. Term also refers to adjustment of debts of an individual with regular income as provided for under Chapter 13 of the Bankruptcy Code.

See also bankruptcy proceedings

- compromise and settlement

- debt pooling

- wage earner's plan

@ debt cancellation

Under federal tax law, discharge or cancellation of indebtedness ordinarily results in income to debtor when he settles debt for less than amount which he owes. I.R.C. No. 61(a)(12).

See bankruptcy proceedings

@ debt consolidation

See debt pooling

@