Legal Question in Business Law in California

Re: misappropriation of funds or fraud

Advice in the context of Law Guru needs to be general, rather than specific. If you want to discuss your specific case in more detail, please email me.

You appear to have a claim for damages based on breach of contract for the money that he overpaid.

You may have a claim for damages for "theft of time" if he took paid vacation in excess of that to which he was entitled.

It sounds like there could also be grounds for a claim of fraud.

Taking company money could also be conversion, in the civil context, and embezzlement in the criminal context.

Re: misappropriation of funds or fraud

"Jail time" comes from criminal charges. File those if you like.

You sue for whatever your provable damages are. In your case, you have to file a Cross-Complaint since he already started a case, and you have to defend against his claims. Feel free to contact me if this is in SoCal, and you're serious about getting legal help.

Re: misappropriation of funds or fraud

For the most part I agree with Mr. Telanoff's assessment of your options. In addition, there could be other claims for negligence, breach of fiduciary duty, etc.

First thing's first, if he has filed a legal claim (lawsuit/summons and complaint) against you make sure to deal with that properly. You didn't say what type of business entity this is so make sure to hire a lawyer to defend you if it is anything other than a sole proprietorship (an attorney must represent a corporation, LLC, etc.). Your claim against him may need to (and, most likely, must) be filed as a cross-complaint to his complaint.

If you would like further help feel free to contact me.

Re: misappropriation of funds or fraud

You can sue him for breach of fiduciary duty as the president of the company. As an officer, he must not take funds from the company and he breached his duty.