--- name: cognovit-promissory-note title: Cognovit Promissory Note description: 'Drafts a U.S. cognovit promissory note with confession of judgment clause, enforceability gate, and execution formalities. Use when preparing a commercial loan note with cognovit language, confession of judgment, warrant of attorney, or waiver of notice/hearing rights. Triggers: cognovit, confession of judgment, warrant of attorney, waiver of defenses.' author: CaseMark author_url: https://github.com/CaseMark/skills/tree/main/skills/legal/cognovit-promissory-note license: Apache-2.0 version: 0.1.0 execution_mode: open jurisdiction: us practice: finance language: en --- # Cognovit Promissory Note Draft an enforceable cognovit promissory note compliant with governing-state law. A cognovit clause lets a borrower authorize entry of judgment without prior notice or hearing — most states prohibit or heavily restrict this, so enforceability must be confirmed before drafting. ## Prerequisites Collect before drafting: - **Governing law / forum** — state and venue for enforcement - **Parties** — legal names, entity types, formation states, addresses, authorized signers - **Loan terms** — principal, rate, term, payment schedule, fees, prepayment - **Transaction type** — commercial vs consumer classification; any statutory exemptions - **Authority docs** — resolutions, incumbency certificates, consents (if entity borrower) - **Collateral / guaranties** — summary of related security documents, if any ## Quick Start 1. Run the **Enforceability Gate** (below) — if cognovit is prohibited, stop and output a standard note + guaranty + security agreement instead. 2. Draft the note using the **Document Sections** outline. 3. Walk the **Checks** list before finalizing. ## Enforceability Gate (Do First) | Check | Action | Output | |---|---|---| | Cognovit permitted? | Research governing-state statutes + recent case law | Allow / deny with citations or `[VERIFY]` | | Consumer restriction? | Confirm borrower classification | If consumer or mixed-use, treat as **prohibited** unless clear statutory exception | | Required warnings / format? | Identify mandatory warning text, font size, capitalization, separate acknowledgment | Insert exact statutory warning or `[VERIFY]` | | Execution formalities? | Check witness / notary / affidavit / attorney requirements | Add required signature formalities | **If prohibited or materially restricted:** output alternative structure (standard note + guaranty + security agreement) and stop. ## Document Sections ### 1. Preamble and Parties - Date, principal (numeric and words) - Lender and Borrower: legal name, entity type, formation state, address, signatory title - Authority evidence: resolution/consent, incumbency, power/authority certification ### 2. Economic Terms | Term | Details | |---|---| | Principal | Amount; fees/points treatment | | Interest | Fixed/variable; index, margin, caps/floors; accrual method; day-count | | Payments | Amounts, dates, schedule type, grace period | | Application | Order: fees → interest → principal (or specified) | | Prepayment | Permitted? Penalty? Formula; usury compliance | ### 3. Confession of Judgment Clause Include all of: - **Authority grant** — borrower authorizes any attorney to confess judgment after default - **Scope** — principal, interest, fees, costs, attorney fees - **Timing** — upon default or after cure period - **Forum** — permitted courts; must align with governing-law / venue clause - **Waivers** — notice, hearing, defenses, discovery, jury trial (if allowed) - **Statutory warning** — exact required text and formatting per governing state ### 4. Defaults and Remedies - Monetary default (failure to pay; grace period) - Cross-default (thresholds, if applicable) - Insolvency events (bankruptcy, assignment for benefit of creditors) - Misrepresentation (material statements) - Collateral events (if secured: impairment, transfer, insurance failures) - Remedies: acceleration, confession of judgment, collection costs ### 5. Governing Law, Jurisdiction, Venue - Governing law with substantial relationship to transaction - Consent to jurisdiction and venue - Waiver of forum non conveniens (if allowed) - **Jury trial waiver** — must be conspicuous ### 6. Execution and Acknowledgments - Signature blocks with titles and entity capacity - Witness / notary blocks (if required by state) - Separate cognovit acknowledgment (if required by state) ### 7. Exhibits (as needed) - Amortization schedule - Authority documents - Collateral schedule ## Template Skeleton ```text COGNOVIT PROMISSORY NOTE Date: [Date] Principal Amount: $[Amount] ([Words]) FOR VALUE RECEIVED, [Borrower] ("Borrower") promises to pay to the order of [Lender] ("Lender") the Principal Amount plus interest: 1. Interest. 2. Payments. 3. Application of Payments. 4. Prepayment. 5. Events of Default. 6. Remedies; Acceleration. 7. Confession of Judgment. [Full clause + statutory warning + waivers] 8. Governing Law; Jurisdiction; Venue. 9. Jury Trial Waiver. [CONSPICUOUS] 10. Notices. 11. Miscellaneous. BORROWER: LENDER: By: ______________ By: ______________ Name/Title: Name/Title: Date: Date: [Notary / Witness Blocks if required] [Separate Cognovit Acknowledgment if required] ``` ## Checks - [ ] Enforceability gate passed — cognovit is permitted for this transaction type in the governing state - [ ] Consumer / mixed-use classification confirmed; if consumer, cognovit clause omitted - [ ] Statutory warning language is exact, conspicuous, and placed per statute - [ ] Confession clause forum aligns with governing law and has substantial relationship to transaction - [ ] Usury analysis complete — includes all fees/charges treated as interest; exemptions noted - [ ] Waivers are conspicuous and not buried in boilerplate - [ ] Execution formalities match governing-state requirements (witnesses, notary, acknowledgment) - [ ] If enforceability is unclear, alternative structure (standard note + guaranty + security agreement) recommended instead