Skip to main content

The LLC/Business I was a part owner of closed. I'm being sued by a creditor for unjust enrichment. Need help defending this.

Camarillo, CA |

I was a part owner in a failed LLC in which I had a 70% stake. The LLC purchased goods from a vendor owing them 12K. The LLC stopped purchasing about 1 year before it closed. The LLC made payments AFTER it had stopped buying reducing the amount owed to 5K. the LLC then stopped making payments. About 6 months later the vendor sued the LLC a judgement of about 11k was granted. At about the same time the LLC ceased operations owing me 1.4 million on its loans. I lost everything in the process. Now im being sued personally for unjust enrichment . Plaintiff pleading is inaccurate, spurious, and simply egregious. I never took a salary and worked 80 hours a week. I need to defend myself pro se and would like to file a summary judgement and then malicious prosecution please help...

+ Read More

Attorney answers 4

Posted

You would be well served to find a local attorney that can defend this suit. This is beyond the scope of this forum. We are not able to write a response to the Motion for Summary Judgment. I really encourage you to hire an attorney.

Posted

If a lawsuit is going on, you need a lawyer, even for this small amount. Mr. Adam Jaffe regularly posts excellent answers from Camarillo on Avvo and is easily located on the Avvo find a lawyer function.

The above is general legal and business analysis. It is not "legal advice" but analysis, and different lawyers may analyse this matter differently, especially if there are additional facts not reflected in the question. I am not your attorney until retained by a written retainer agreement signed by both of us. I am only licensed in California. See also avvo.com terms and conditions item 9, incorporated as if it was reprinted here.

Asker

Posted

Thanks for your time in answering. I will contact Mr. Jaffe but in this whole process I lost everything. Its a long story to which this is just another thorn in my side. The complaint is completely spurious by a collection attorney who is a real peach. I cannot afford counsel at this point and plan to defend the case myself. The facts are totally on my side and the claims made in the pleading are not even close to the facts/dates of the actual transaction. If I could afford counsel, I would think of pursuing them on a malicious prosecution after this is settled. however while I believe I can prevail at trail, I also feel i could likely prevail at a summary judgment hearing. So, what I'm looking for is help in understanding what a) the requirements or burden of proof is on the plaintiff's behalf, b) since I know that there are no material facts supporting their claims, and in fact the fact themselves are in direct contrast to their claims, how to bring that up to the court for a summary judgment hearing to potentially make this go away. If you are willing to help in that regard, great. I need it. If not, I totally understand. While it was common place for me in my past life to engage 500 and hour attorneys, I have nothing left at this point and those guys are no where to be found.. What a shocker..

Michael Charles Doland

Michael Charles Doland

Posted

It's a horrible situation. Mr. Jaffe, however, based on what I've seen, might be willing to give a limited consultation to keep your costs down.

Posted

You will need an attorney to file a proper responsive pleading. One of your defenses may be that under the "one judgment" rule, the plaintiff is barred from bringing a second lawsuit on the claim if he/she/it has already obtained a judgment against someone else on that claim.

You may also have a Statute of Limitations defense on the unjust enrichment claim.

Summary judgment motions are very complicated and requires an attorney. Reach CCP 337. Check the court filing fee for the motion.

A malicious prosecution action cannot be filed as a counter claim in your suit. You must win on the merits, then file the lawsuit. And you must prove "malice". This is tough.

Look at the original contract between the LLC and the creditor. On any of the invoices is there a provision which mentions attorney's fees? If so, you may recover your attorney's fees if you successfully defend the case.

Also, anticipate that the plaintiff will propound some very onerous discovery regarding the financial affairs of the LLC and of you.

Asker

Posted

Richard, thanks for your response. While summary judgment claims are complex, I'm no stranger to litigation. Although my current economic condition would not suggest so. This is a overly eager collection attorney with an issue.. While true, there is only one action they can file, were their claims to be correct and their facts close to accurate, they WOULD have the opportunity to come after me personally on an alter ego theory. however, in their suit they allege that the LLC purchased goods and services from the Plaintiff and then simply skipped on the bill with no intention of paying. in fact what happened is that the LLC purchased about 3K worth of product, then at the same time made a payment to them for about $3500 reducing the amount owed to the Plaintiff to about 9K at that time in January of 2010. . Subsequently the LLC stopped doing business with the Plaintiff and continued over the next few months making regular payments on account without receiving any product from Plaintiff to reduce the amount owed to about 5-6K or so. A dispute arose between the parties and then the LLC stopped making payments to the Plaintiff. Subsequently they sued about 6 months later got a judgement against the LLC for about 11-12K or so. At about the time of the judgement the LLC was shut down (illegally by the County of LA which is an ongoing litigation itself). While the retail operations where closed, the LLC itself still exits. hence, the claim that the LLC purchased the goods and simply shut down are ridiculous at best. Their pleading is a mess and totally inaccurate. Because of my economic situation the court granted me a fee waiver. While there IS a contract between the LLC and the Plaintiff, there is NOT a contract between myself and the Plaintiff. I simply was a part owner and the idiot who put up the money, worked 80 hours a week for free for 3 years and now is being sued. nice..

Richard Scott Lysle

Richard Scott Lysle

Posted

You can recover attorney's fees on a contract even if you prove that you were not a party to that contract.

Posted

First off,"Unjust Enrichment" is not a cause of action, it is a remedy - usually in fraud cases. The lawsuit must be alleging some fraud otherwise the separate corporate entity of the LLC shields you from personal liability. Regardless, since you have been sued, you must file an answer within 30 days of being served. You need to consult with an attorney in Ventura County for some assistance even if you initially file in pro per. It may be that an attorney can call or write to the plaintiff's attorney and dissuade him/he from pursuing the case if there is no probable cause - no evidence of fraud on your part.

Richard A. Rodgers, Esq.
SHANE, DiGIUSEPPE & RODGERS LLP
200 N. Westlake Blvd., Ste 201
Westlake Village, CA 91362
(805) 230-2525
rar@sd-attorneys.com
www.sdresq.com

As stated in the AVVO.COM Terms and Conditions of Use, this answer is not intended as legal advice, and no attorney-client relationship or privilige is created by this response.

Asker

Posted

Richard thanks for the response. I am aware that unjust enrichment is not a cause of action etc. I have answered the case. AS well I have appeared in the case at now 2 hearings and have successfully gotten the venue changed from Orange County to Santa Monica; a bit closer to me. To this end, I filed my answer and now have been served with rogs from the Plaintiff. My issue is that trial will be relatively simple. There are no supporting facts to "pierce the corporate veil" that I am aware of and further, the true facts/timelines when examined, tell an entirely different story than what the complaint the Plaintiff alleges for sure. I was simply hopeful of being able to file a summary judgment to make this case potentially go away. Which may be technically above my ability in pro se. That said, I will, absent of that motion, defend this. I was hoping for help understanding what are the key factors which would bring a successful summary judgment motion. If Plaintiff alleges facts that are not correct (per the evidence) which are the sole theory of his case, then is summary judgment the correct move? Or alternatively should I demurrer? Did I waive or give up my right to file a demurrer by not filing the demurrer when I answered the complaint? thanks.

Richard Alan Rodgers

Richard Alan Rodgers

Posted

Summary judgments are not easy to get, and amost impossible in a fraud case. It is a trial on paper and if there is any disputed material fact that the judge cannot dispose of as a matter f law or by judicial notice or irrefutable admission, then the MSJ wil be denied - a lot of wasted work. The burden of proof is on the plaintiff and you say its an easy case - it may be that you just go to trial, but you should at least meet with a business litigation attorney to go over the facts of the case and any possible elements of fraud that the plaintiff wil noeed to prove in order to pierce the corporate veil.

Bankruptcy and debt topics

Recommended articles about Bankruptcy and debt

What others are asking

Can't find what you're looking for?

Post a free question on our public forum.

Ask a Question

- or -

Search for lawyers by reviews and ratings.

Find a Lawyer