We draft, review and enforce promissory notes tailored to your financial needs. Our services ensure clarity, legal compliance and enforceability under Ontario law.
Why Use Our Promissory Note Services
- Custom drafting to include all essential terms and protect your interests.
- Review existing notes for validity and risk mitigation.
- Advice on negotiability, enforcement and limitation periods.
- Support in default management, negotiations and legal proceedings.
- Guidance on estate implications and note transferability upon death.
Our Promissory Note Services
- Drafting clear, enforceable promissory notes for personal and commercial loans.
- Reviewing and validating third‑party notes under Ontario statute.
- Advising on limitation periods and statutory requirements.
- Enforcement actions: demands, negotiations and court applications.
- Advice on estate administration and note disposition after death.
Common Questions About Promissory Notes in Walker
What is required on a promissory note in Ontario?
A valid Ontario promissory note must name the maker and payee, state the principal sum, and set out an unconditional promise to pay.
It also requires a clear payment date or schedule and the maker’s signature to be enforceable.
What makes a promissory note invalid in Ontario?
Notes missing essential elements—or tainted by fraud, duress or illegal purpose—are void.
Ambiguous terms or lack of signature also render a note unenforceable.
What is the limitation period for a promissory note in Ontario?
Ontario’s Limitations Act generally provides a two‑year period from default to commence enforcement.
Parties should act promptly to avoid the expiration of their rights.
What is the 2 year limitation period in Ontario?
For negotiable instruments like promissory notes, you have two years from the date of dishonour to file a claim.
Failure to act within this window bars legal remedies under provincial law.
What are the conditions for a promissory note?
Essential conditions include an unconditional promise, specified amount, payment terms, and place of payment.
Additional clauses like interest rates or acceleration are permitted if clearly drafted.
What are the rules for promissory notes?
Notes must comply with the Bills of Exchange Act and provincial statutes regarding form and presentment.
They are transferable, enforceable by endorsement, and governed by negotiable instrument rules.
What are the limitations of a promissory note?
They offer less flexibility than full loan agreements and depend on the maker’s creditworthiness.
Enforcement is subject to statutory limitation periods and formal presentment requirements.
What are the risks of promissory notes?
Risks include default, high enforcement costs, and ambiguity in informal documents.
Proper legal drafting and review mitigate these risks significantly.
What happens if the maker of a promissory note fails to pay?
The payee can demand payment, negotiate settlement, or initiate court proceedings to recover the debt.
Successful judgments may lead to garnishment, seizure of assets, or insolvency filings.
What happens to a promissory note after death?
If the maker dies, the note becomes a claim against the estate and must be presented to the estate trustee.
If the payee dies, the note passes as an asset of their estate to their beneficiaries.
How do I write a simple promissory note?
Include the date, parties’ names, principal amount, repayment schedule, and signatures.
Use clear, unconditional language and specify any interest or acceleration clauses.
How to write a promissory note for a family member?
Treat it as professionally as a commercial note: document all terms in writing and obtain signatures.
Include date, amount, repayment terms, and witnesses to avoid future disputes.
Can I have a promissory note with no interest?
Yes, parties may agree on a zero‑interest promissory note if it meets legal form requirements.
Absence of interest does not affect enforceability under Ontario law.
What is another name for a promissory note?
It is also called a note payable, IOU, or negotiable instrument.
All terms refer to a written promise to pay a debt under specified conditions.
Who draws a promissory note?
The maker—or borrower—prepares and signs the note, committing to pay the lender.
The payee receives the note as evidence of the debt.
Who is primarily liable on a promissory note?
The maker (borrower) bears primary liability to pay the amount owed to the payee.
Endorsers or guarantors assume secondary liability if included in the instrument.
Are promissory notes legally binding in Canada?
Yes, properly drafted promissory notes are enforceable contracts under Canadian law.
They serve as evidence of debt and can be enforced in court if unpaid.
Can anyone write a promissory note?
Any competent adult can draft a promissory note, but legal precision is crucial for enforceability.
Professional review ensures compliance with statutory requirements.
Is a promissory note a debt obligation?
Yes, it is a formal written obligation to repay a debt under agreed terms.
The note sets out the rights and duties of the parties involved.
How reliable is a promissory note?
Reliability depends on clear drafting and the maker’s financial capacity.
Legal enforcement mechanisms provide remedies in case of default.
Can you negotiate a promissory note?
Yes, promissory notes are negotiable instruments that can be transferred by endorsement.
New holders acquire rights to enforce payment under the note.
Is IOU considered cash?
No, an IOU is evidence of debt but not legal tender like cash.
It must be converted into a payment obligation through enforcement if unpaid.
What is the most common example of a promissory note?
Personal loans between individuals or small business loans typically use promissory notes.
Mortgage notes for real estate also serve as specialized promissory instruments.
How do I show a promissory note is paid in full?
Issue a written receipt or stamp the original note “Paid in Full” with the maker’s signature.
Return the note to the maker and record the transaction date for your records.
How long does a promissory note last?
It remains enforceable until payment and presentation deadlines expire under limitation statutes.
Statutory periods vary but typically range from two to six years after default.
How do I discharge a promissory note?
By full payment of the principal and any interest, then cancelling or marking the note as discharged.
Returning the original instrument to the maker concludes obligations.
How do I terminate a promissory note?
Mutual agreement to cancel the note should be documented in writing and signed by both parties.
Alternatively, drafting a new note with updated terms supersedes the original.
Contact Us
For tailored promissory note drafting and enforcement solutions, contact us at for a confidential consultation.