Also known as: prepaid expenses · prepayment
Written by attorneys · grounded in primary & secondary sources — see below
An expenditure of money made in advance for goods, services, or benefits to be received in a future period. The payment creates an asset on the payer's books until the benefit is realized or the obligation matures.
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Bay Networks paid the full principal on its mortgage to Ridge Byte five years early after selling an app. Ridge Byte refused to record a satisfaction because of an ambiguous clause. Bay Networks sued to clear title for its sale to Omega Networks. The court held that the lump-sum payment satisfied the debt and required the lender to record the release.
National Oil obtained a receiver after Alpha Oil defaulted. The receiver collected rents, paid taxes, and made repairs before Creek Power sought its own receiver. The court allowed the junior receiver to keep the net rents after those expenses but required it to surrender an unauthorized tenant prepayment to the senior interest.
College Savings Bank paid advance licensing fees to the Florida Prepaid board for educational patents. When the board later refused to honor the licenses, College Savings sued in federal court. The Supreme Court addressed whether the state could be sued for the prepaid amounts without its consent.
M.L.B. sought to appeal termination of her parental rights but could not prepay the record-preparation fees required by Mississippi law. The state supreme court dismissed the appeal. The U.S. Supreme Court considered whether the prepayment requirement violated due process for an indigent parent.
A patient prepaid for nonemergency care at Memorial Hospital but was denied treatment because he had not resided in Maricopa County for the required period. The county defended the prepayment-plus-residency condition. The Supreme Court examined whether the rule burdened the right to travel.
Panetti filed a habeas petition without prepaying the filing fee and sought in forma pauperis status. The district court required partial prepayment under the Prison Litigation Reform Act. The Supreme Court addressed whether the prepayment rules applied to successive habeas claims raising competency issues.
Full payment of the principal, including by prepayment, satisfies the underlying obligation by operation of law. The mortgagee must then execute and record a satisfaction to clear title. An ambiguous clause does not create an enforceable premium that blocks discharge.
The junior receiver must first apply collected rents to taxes and reasonable maintenance expenses. Only the excess may be applied to the junior obligation. Unauthorized prepayments from tenants must be surrendered to the senior interest.
…preparation costs. Mississippi law provides that an indigent parent may not appeal a termination of parental rights without prepayment of fees for preparing the record on appeal. M. L. B. filed a motion for leave to proceed in forma pauperis in the Mississippi Supreme Court. That court denied the motion. M. L. B. then…
…because "appellees have made no showing that they were ever assessed civil penalties under the Act, much less that the statutory prepayment
…2nd, 1958. The right is hereby granted to the second parties to prepay all or part of the balance due to the first party. If prepayment
…having a market value of approximately 150% of the amount of the loan. In addition, Jet Capital was expected to apply to the prepayment
…the commitment letter in this action. It provided for a 35-year loan at a yield of 14.25%, with a “lock-in” provision forbidding
No. The prepayment remains an interim distribution shared equally among all partners. The assignee receives only the assigning partner's share. The assignment does not enlarge the shares of the remaining partners or reduce the total number of shares.
A manager remains liable for obligations incurred during service even after resignation and sale of the interest. The statute preserves the liability to the LLC regardless of later departure unless an express release is given in the sale documents.
Proper service requires both delivery of the subpoena by a nonparty adult and simultaneous tender of the statutory witness fee and mileage. Without the prepayment of fees, service is defective and the witness need not appear.