Legal Question in Business Law in California
Leasing a business?
I was offered an opportunity to "lease" a business, I have no resale license or business license for the city in which I live, I was then offered a job as "profit sharing manager" by the same owner. The business made no profit and the owner expected me to assume any losses personally. With no written agreement or contract, I quit after the owner demanded I make up any losses from my pocket. I feel I have been taken advantage of since I turned a dead and buried business into one that was nearly making all expenses on it's own revenue within 30 days of my taking over as manager. During that time I received no pay, put in 93 hrs/wk, took over all responsibility for running the business, including hiring/firing, marketing, inventory, customer relations, menu changes and items served. I was placed on the payroll 1 month prior to quitting to cover me in case of injury and now the owner refuses to honor the payroll checks. Where do I stand on this legally?
3 Answers from Attorneys
Re: Leasing a business?
If you can prove that you actually worked for him then you can sue him for back wages and the regular rate of pay for someone in that position. If he has already given you a check, but the check has bounced that can be shown as proof. What is his reasoning for not paying you for your time? Does the business still exist? These are questions that are not answered in your question and are vital to a legal and correct answer. Please feel free to email me or call me with this information and I would be happy to help you determine your next course of action. I can be reached at 888-563-8529.
John Hayes
Re: Leasing a business?
Sounds like you were ripped off. Go to the State Labor Commssioner's office. they will help you get your wages and they wont charge you.
Re: Leasing a business?
My guess is that, as a practical matter, your remedies are going to be limited
to asking the State Labor Commissioner to help you
get your "payroll" checks honored. It would be hard
for you to establish that you are entitled to any damages
for breach of an oral contract to run the business,
because, in the absence of any profits, it's hard to
argue you have suffered any damages. Also, it's
always hard to enforce an oral contract, especially
one as uncertain as yours. In the future, before you
enter into any sort of deal like this, consult with
an attorney and get the terms of your deal in writing.
Attorneys aren't all that expensive, and even if it had cost
you, say, $2,000 to get the contract drafted and
negotiated, you'd be way ahead today, because you'd either
have an interest in an on-going business, or you'd
have a valid cause of action against the owner.
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