My partner I are purchasing an equally divided 49% share of a restaurant. (I am purchasing a 24.5% share) We had a verbal agreement with our seller's for $250k for 49% of the outstanding stock, assets, & improvements. The Restaurant is a Californ...
Typically, a well-crafted purchase-sale agreement (PSA) would address the handling of cash in accounts on sale. If the agreement is not signed, you may consider holding off until this important issue is resolved. Simply put, I would surmise that your purchase price was based on financial reports (i.e., the tax returns and balance sheet). If that cash you are referring to was an asset on the balance sheet, it should have been factored into the valuation of the business, and therefore the value of the stock you are purchasing. If the cash on hand (or part of it) is no longer in the company (and no longer part of what you once agreed to purchase), that may have a material effect on the value of the stock.
If you do no already have any attorney, the best advise is to hire legal counsel experienced in business acquisitions and sales. When you hire an attorney, you may also want to the attorney to evaluate the scope of the actual and potential corporate liability that you may be purchasing.
Lastly, be careful who you do business with. As a 49% holder you would be a "minority" shareholder with little control over the course of the business. While the withdrawal of cash may be innocent, the fairness of that conduct should be carefully evaluated.
Good luck.See question
An Owner/Builder is asking me to sing an Unconditional Final Release. I have not been paid for the retention yet. Under the Exceptions are they put "Final Retention". I believe the Exceptions area is designated for Change Orders. Am I protecte...
California courts have strictly construed these forms of release with devastating effect.
The purposes of the “unconditional” release is to evidence you have been paid in full. If you have not been paid, and you are being asked to sign either an Unconditional Waiver And Release on Final Payment or an Unconditional Waiver And Release on Progress Payment, the safest path is to not sign either. While there may be some exceptions to the rule, if you want to make sure you are paid, it is recommended that you not release any payment rights unconditionally.
The best practice is to accurately read and complete the Conditional Waiver And Release on Final Payment (or Conditional Waiver And Release on Progress Payment, as the case may be) and provide that document with your payment request. Once you are paid, and once your check clears the bank, only then would you sign the applicable “Unconditional” release.
Seek the advice of a competent construction law attorney in your area.See question
I have a question about possibly assuming the debt/buying a prior company. The original owner cannot be contacted and the business was suspended by the state in 2005. The suspension has since been lifted, but the corporation is not active. How wou...
Given these limited facts, I believe it is most important for you to locate a competent business attorney experienced in business sales and acquisitions to provide you detailed advice on the inherent risks of acquiring an existing business. In most cases when you purchase an existing business (which is different from purchasing the assets of the business), you become a successor to the debts and liabilities of that business. For that reason, most business sales are handled through the bulk sale provisions of the California Uniform Commercial Code.See question
I hired a granite fabricator under contract to finish and install granite I purchased and he signed for at the material yard. I also hired his friend to do all the floors for 6800. He installed vinyl plank in the kitchen / laundry and a 10x3 wood ...
The analysis of your rights and remedies begins with whether you have a written contract with the fabricator. That document, if any, may address your rights and remedies in this dispute. If there is no written agreement, the terms of your agreement may be more difficult to prove and, more importantly, you may not be able to recover any attorney’s fees you incur in resolving this dispute even if you prevail. However, notwithstanding the existence of a written agreement, the fabricator (who may have provided labor) may have a right to record a Mechanic’s Lien (claim of lien) against the real property, which may be the most important issue.
Given the limited facts that are provided, the complexity of this area of the law, and the possibility that a lien may be recorded, the best advice is to engage competent legal counsel who is familiar with construction law and mechanic’s liens to assist you. As this may be a time sensitive matter, a delay in engaging legal counsel could be detrimental.
Avvo should be able to provide you a number of good leads for your area.
Best of luck in resolving your matter.See question
My husbands mother has a POA for my husband from 2011. We got married in 2012. My question is can she still use the POA? And could she go and take money out of our joint bank account?
Your question refers to a “POA”, which if taken literally may only refer to a power of attorney and not a durable power of attorney. The difference is material. In either event, however, your concerns are well founded as the wrongful use of a power of attorney can have devastating effects. Unfortunately, your question cannot be answered without first reviewing the instrument and for that reason, the best suggestion is to consult with a competent attorney.See question
Only about 1/3rd of my reimbursement is secured by the 20 day preliminary notice. I have sent him a preliminary notice and will put a mechanic's lien on the property if he doesn't pay me, but can I sue the owner in small claims court for the balan...
The best advice given so far is to contact a competent attorney experienced in construction claims and liens. This is a complicated area of the law and it is somewhat difficult to explain in a short answer. I would first recommend that you become familiar with the terminology. As a contractor if this is not your first mechanic's lien action, I can almost guaranty that it will not be your last. You can search the California Civil Code online and the mechanic's lien laws that apply to private construction (public works does not recognize mechanic's liens) begin at Section 8160 of the Civil Code. The requirements of a valid "Preliminary Notice" begin at Section 8100. Section 8200 discusses the application, purpose, and restrictions on mechanic's lien actions.
Under the new statutes, a general contractor may be required to give Preliminary Notice in certain circumstances. Because there is no penalty for giving notice, whether you are a general (original) contractor or subcontractor, in the future you may want to consider giving a preliminary notice to all the required parties (i.e., owner, lender, general contractor), irrespective of your contractual position.
The next consideration is whether this is new construction or a work of Home Improvement. If you are improving an existing structure and fail to have the correct contract and give the correct notices, even if you have properly served the Preliminary Notice, you may have no collection rights under the Home Improvement Contact Law.
Lastly, it is true that the perfection of a mechanic's lien is not within the jurisdiction of the small claims court. While there may be an opportunity to combine various actions against various parties (depending on whether you are an original contractor or subcontractor), I would recommend you not get lost in those details at this point. Simply, the mechanic's lien is effective as to sums earned within 20 days prior to the date of service of the Preliminary Notice through completion. If you are in contract with the Owner (subject to the conditions of Home Improvement Contracts), you may sue the Owner (not under mechanic's lien) for the entire unpaid balance of the contract price plus the reasonable value of additional or extra work in place. If you are a subcontractor, you may sue the Owner to perfect on the mechanic's lien (subject to the preliminary notice requirements) and the original contractor under various theories of recover including breach of contract.See question
I have an ongoing dispute with a contractor who did not complete the work and also is trying to overcharge me for the services provided. The last time anyone of from their team worked on my property was on 9th August 2014,so I want clarification o...
I believe the correct answer to your first and second questions is "yes". The real issue is not whether the mechanics' lien can be recorded, but whether the mechanics' lien can be perfected and enforced under your circumstances. While I agree generally with the four other responses, it is important to note that there are prerequisites to the recording of a mechanics' lien in California that, if not followed, will render the lien unenforceable. For example, you may want to consider the following issues: 1) Is the contractor properly licensed? If not, there may be no right of enforcement; 2) was the mechanics' lien properly verified with a copy mailed to you? If not, the claim of lien may be invalid; 3) Due, for example, to the existence of construction financing, was a Preliminary Notice served on both you and the construction lender; 4) was this a work of Home Improvement and was the proper Home Improvement Contract provided you with the notice of your right to cancel the contract?
As to your third question, a complete answer exceeds the scope of this forum. I would strongly recommend that whether or not the mechanics' lien is filed, you contact competent legal counsel (experienced in construction law) as soon as possible to ensure that you do not lose any of your important legal rights and remedies through either or both of inaction or the passage of time.See question
Work was completed on Saturday. I initiated the bank payment on Saturday. On Tuesday, construction company told me they are issuing a mechanic's lien for non-payment. They need to wait a few more days for the check to arrive but the said the la...
While the contractor "can" record a lien, the question is whether the recorded (not filed) lien is legally defensible. This area of the law is complex. If the Contractor did record a Mechanics' Lien, he was required to provide you (presumably the homeowner) written notice of the recordation of that instrument. If the Contractor did not provide the required notice, the lien may not be valid. If the work was performed by a Contractor on your home, your contractual rights and remedies will be dictated, in large part, by the California Home Improvement Contract Law. That body of law establishes certain requirements for both notice and contract terms and conditions. If the Contractor has not followed those requirements, properly given notice of your right to cancel, or is not properly licensed, your Contractor may have no right to payment. If the Mechanics' Lien is expired or unmerited, there is a provision that allows you to petition the court to release the lien and you may be entitled to recover a statutory amount for attorney's fees. Lastly, you may also file a claim against the contractor with the Contractors State License Board and the Contractor's license bond. Best advice: Seek competent legal counsel experienced in construction law; the failure to obtain a release of the lien may have serious legal consequences.See question