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Breach of Promissory Note: Saint Louis, Missouri

Though often confused, promissory notes and contracts are two different types of legal documents. A contract requires an offer, acceptance, and consideration. Consideration is an exchange between two parties/entities — e.g., I pay you rent in exchange for you making an apartment available to me for living space. Breach of contract actions or specific performance are generally the appropriate legal remedies to pursue if things go awry. Contracts are primarily a species of the common law (aka case precedent).

Unlike contracts, promissory notes are a creature of statute (e.g., the uniform commercial code). A promissory note is a promise to pay a fixed amount of money at a set time. Rather than a present exchange of consideration, the promissory note is often “for services rendered.” Promissory notes usually work in conjunction with other documentation which detail more thoroughly the underlying transaction. For example, in most real estate transactions, the promissory note covers the amount owed, interest, and maturity date — while the complimentary deed of trust will outline responsibilities of all parties involved more precisely.

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