Legal Question in Investment Law in California

Re: Ripped off !

Even if the guy were alive and well, it would be somewhat doubtful. When you invest in a business, the first question that comes up is whether it was a loan, to be repaid with interest at a time certain, or an equity (risk) investment, entitling the investor to part ownership and maybe a share of profits. The latter kind of investment is not intended to be repaid; it is not a loan, it become part of the permanent capital of the business. Unless you can prove that the investment was a loan, it would be treated as an "at risk" permanent contribution to capital and you would then have to prove that some kind of fraud was involved that entitled your father to restitution of the investment. However, just because the debor is dead doesn't mean the guy's estate isn't liable; it is just harder to establish the facts against someone who isn't there to defend.

I'd say you have two practical problems in recovering the $15,000. The first is proving, either to an executor or a judge (or jury), that you are entitled to its return, either because it was a loan that is now due, or if it was not a loan but rather an equity investment, that it should be returned due to fraud or some other similar reason.

The second practical problem is collecting on a claim against the estate or on a judgment against the estate. The guy who was killed may have had no estate, or it may be too late to make claims against it.