Legal Question in Business Law in California

Re: Partnership

Well you work are among many things that don't feel alone. Hopefully you will have learned from this situation. You don't jump into things without checking out the other guy. More importantly you must have something in writing. Yes, there is a contract here. You have a two-year statute limitation which to file suit. My immediate advice is get yourself an attorney now. You want someone who is expertise in business/litigation. All the problems that you will face are numerous. The biggest problem is going to be his version of the contract will be much different than yours. The best part you have if you are totally correct is to follow the money and paper trail. Don't wait make sure you have an appointment on Monday to protect your you know what.I have been practicing law in this legal area for over 30 years and understand your problem well. I practice in the S.F. Bay Area and if you wish to contact me call at 925-945-6000.

Re: Partnership

There are several laws or legal principles that apply to your facts and are in your favor. I'll briefly mention a couple of them.

First, a partnership is formed whenever two or more persons combine forces in a business venture with the intention of sharing the profits. A written agreement isn't required (although one is very desirable) and in fact an oral agreement may not even be essential; the partnership might be inferred from the parties' conduct.

When a partnership is thus formed, any terms that are not agreed upon will be the "standard" terms found in the California Revised Uniform Partnership Act, supplemented by case law (i.e., prior court decisions).

Oral contracts are enforceable for the most part. A few are not, due to the Statute of Frauds. This is a supplemental tool in your case, since partnership law alone could be the foundation of your case against the erstwhile partner.

The next set of legal principles in your favor have to do with the duties owed by partners to one another and to the partnership. Partners are said to be "fiduciaries," meaning they must act in good faith and be trustworthy, never taking unfair advantage of the other, something like a trustee or guardian. The duties of a fiduciary are "ex officio" (arising from status or office) and do not require a contract.

Finally, there are aspects of partnership law that protect its property, which dictate when a partner may and may not withdraw without liability to the other(s), and who is entitled to wind up the partnership's affairs and deal with its property when it dissolves. All these provisions of law would cut in your favor.

There may be a case for a fraud charge here, or for the tort of conversion.

All in all, a pretty solid legal case can be made from the facts you give; of course, you have several obstacles to recovery of a judgment, among which are (1) marshaling your evidence and witnesses to prove your case; (2) the probability that the other guy will (rightly or wrongly) accuse you of a bunch of stuff; (3) suit and trial are slow and expensive, and what do you do in the meanwhile? and (4) if you win, will you be able to collect a money judgment?

Another possibility is to add a request for a temporary restraining order, to be followed by an injunction, to your lawsuit. You might get some interim relief that way.

Re: Partnership

I would supplement the earlier posting by saying that your partnership may not have been formed. Sometimes deals are talked about but never reached. To be sure, I'd need to know more about the facts.

If it is the case that your partnership was never actually created, you still may be able to recover under promissory estoppel (the other guy made representations that you foreseeably, justifiably, and specifically relied upon and that reliance has caused you to suffer financially).