Legal Question in Business Law in California

Entered a contract with a company as a DBA 1 and 1/2 yrs. ago, throughout the contract (ended Dec.2010), payment was difficult to collect. They requested additional work towards the end of the contract that was outside the initial scope of work- they paid for some of the work and decided, although they accepted the work, they were not to pay the rest of the work- the final invoices (8,500). I only found out after the work was done and received by the company- in Feb 2011 when I sent them the invoice. Their excuse not to pay was, they have no liability to me because I did the work without a contract- But I have documentation (the work and emails of employees telling me to go ahead with the work and them asking me questions about the project during this time).

The problem I have is- I recently became an LLC. I filed a case in Small Claims court as a sole proprietor because throughout the contract I was a DBA, and I am still a single person, but now I am a Single Member LLC. The company filed an SC105 saying I cannot sue for more than $5,000 because although I was a DBA throughout the contract, I am now a LLC. I am not sure how to proceed? Will SC court dismiss this based on this or will SC court still consider me a DBA, as we will be in court for something that happened over a year ago when I was indeed a DBA and had they paid, would have been paid as a DBA? Would it be better if I keep the court date in SC court and then file in another court (limited jurisdiction court) for the rest, is this possible? If not, how can I recover the full amount? Should I have the SC case dismissed and re-file in limited jurisdiction court? If so, how will the dismissal later be view by the other court? And can I still represent myself limited jurisdiction court as I am a SM LLC?

Thank you very much for any information you can provide.

Christine


Asked on 7/25/12, 12:30 am

1 Answer from Attorneys
Anthony Roach Law Office of Anthony A. Roach

I don't know and I cannot predict what the court will do, but it seems to me your lawsuit is based on the contract between you as an individual with the defendant, and not the LLC that you formed later. It seems to me the matter is a "red herring."

Under Code of Civil Procedure section 116.221, an individual may bring an action in small claims for amounts up to $10,000. That statute has exceptions which are set forth in Code of Civil Procedure sections 116.224, section 116.220 subdivision (c) and section 116.231, subdivision (a).

I'm not sure what section they are citing in their papers, and I hate to assume, so could you provide the specific code section they are relying on?

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Answered on 7/27/12, 12:37 pm


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