Legal Question in Business Law in California
being sued in small claims personally, however it is a corporation matter.
I am pres. of a small business that is a sub-s Ca corp. I am being sued personally by a client whom I have never done personal business with. All business was through the corp. do I go to court and claim wrong party sued, or counter sue for wrongful prosec.Do I reject the summons, or contact court as to the wrong filing. Thank you
4 Answers from Attorneys
Re: being sued in small claims personally, however it is a corporation matter.
you need to reply, if you ignore a default will be entered against you. You should file what we call a demurrer. I would be happy to help you please contact me at my office, use ext. 1
Re: being sued in small claims personally, however it is a corporation matter.
If you do not respond to the summons, the complaining party will likely obtain a default judgment against you. As such, you have to file a demurrer and appear (essentially -- as you suggest -- a demurrer is a document that advises the court that the wrong party is being sued). (The complaining party may likely be confused that he/she contracted with your business (although the contract should clearly show the contractual relationship), but if sophisticated may be arguing that the corporation should be "pierced" -- that is, arguing that you have treated the company assets as personal assets and ignored the distinction and corporate formality to such an extent that the corporate liability limitations should be set aside.)
I'd be happy to address this matter with you and assist you in preparing your response to the claim (remember, an attorney cannot represent you at the small claims court hearing, but you can have legal counsel beforehand).
Bill Bresee
Re: being sued in small claims personally, however it is a corporation matter.
You need to go to the court and defend it. calling the court to tell them about it will do nothing. bring whatever records/employees you need to prove that it was a corp transaction.
Re: being sued in small claims personally, however it is a corporation matter.
Some of the earlier responses have suggested
filing a demurrer. However, you also stated
in your question that the matter is pending in
small claims. Small claims courts are designed to
eliminate much of the motion practice of regular
municipal court. You need to file an answer, denying
liability. The court will set a hearing date. You
need to appear to present your side of the case.
Make sure that in presenting your case, you have
arranged for witnesses to be present to corroborate
your statement that it was a corporate transaction.
Absent evidence of fraud on your part to suggest
that you would personally honor the corporate
obligation, whatever it may have been, you should
be awarded judgment dismissing the plaintiff's claim
against you personally. Make sure also that if the
corporation was also sued, it too appears. You can
appear and represent yourself and the corporation.
Related Questions & Answers
-
When entering a partnership in a small buisness what are some ways of protecting... Asked 4/13/00, 11:41 pm in United States California Business Law