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Dimitry K., Esq.
Dimitry K., Esq., Attorney
Category: Business Law
Satisfied Customers: 38324
Experience:  Run my own successful business/contract law practice.
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1. Do I entered into the contract? 2. Were I stated in

Resolved Question:

1. Do I entered into the contract?

2. Were I stated in writing by and between the seller within the last four years indebted to the seller?

3. Was there a fraud of selling business between a broker and the seller?

There were 4 people in initial offer as buyers (individual), which were A, B, C, and me. All of us signed a Business Purchase Agreement (BPA) and Joint Escrow Instructions as initial offer to purchase a company within produce business in January 2008. This was the only one document I signed for. I also wrote a check with $35,000.00 for deposit. The company was sold for $750,000.00, that was included $300,000.00 security loan in 2 yrs from the seller. The escrow was closed on June 2008.

One of buyers, person A, replaced my check with his check for the deposit and did all of communication and negotiations with the broker and the seller for the rest of the purchasing process. That were included counter offers, Addendums, Security Agreement, First Amendment of BPA, Promissory Note, Bill of Sale, closing escrow and others.

The buyers were written as "person A, et al" or "person A's last name, et al" on all documents, but the signature of buyers only showed person A's signature on all documents, except the initial offer.

I did not authorize person A nor the power of attorney to any one. I were not in operation and decision-making of the new company, nor capital invested.

I did not receive the copies of all documents either.

I were not relative to person A, even we have the same last name.

Now, the seller sued all of buyers and the new company for breach of contract and common counts of $300,000.00 plus interest accroding to the documents of "First Amendment of BPA" and "Promissory Note".
Submitted: 11 months ago.
Category: Business Law
Expert:  Dimitry K., Esq. replied 11 months ago.
Thank you for your question. Please permit me to assist you with your concerns.

Did you invest anything into this company? Was your name listed as an officer or a shareholder in the filings to the state? Did you name ever appear on any documentation at any time?
Customer: replied 11 months ago.


I did not invest anything into this company. After the initial offer on January 2008, I worked on company for production training by seller from April to August 2008. Because the person A did not want me to join investment, I left the company.


 


No capital into the new company. The deposit check, $35,000.00 was returned back to me. I was in payroll of the new company. I were not in the ownership or a sharehoulder of the new company.


Only my full name appeared on a documentation was "BPA and Joint Escrow Instructions" and had my signagture too. No others documentation showed my full name.


 

Expert:  Dimitry K., Esq. replied 11 months ago.

Vincent,

 

Thank you very much for your follow-up. In that situation you appear to be neither an initial purchaser not shareholder or officer of the company at any point in time since your funds were never part of this investment. I do not see it as a contractual agreement because you never formally invested anything as part of this agreement. I am unclear as to why you claim fraud with the sale, and if there was, unless you knowingly refused to remove your name from the initial documentation, I see no further liability to you. The request for the attorney to remove you name from the suit is valid and should be approved by the judge since I am not seeing you as a legitimate party to the suit.

 

Good luck.

Customer: replied 11 months ago.


I have been served already.


Do I need to pay for requesting documentations from seller's attorney? Could seller's attorney remove my name from the suit without I file a demurrer. OR if my name was removed, do I still have to file a response before deadline.


 


I wrote a letter to seller's attorney to request those documentations and also to remove my name from the suit but no response yet.


 


The deadline to file a response is near.


I don't want to spend money to file a demurrer since I knew but not confirmed that I were not binding the contract.


 


I am thinking to file a counter lawsuit (frivolous) and fraud of sale if seller's attorney does not remove my name from the suit.


 


 

Expert:  Dimitry K., Esq. replied 11 months ago.
Thank you for your follow-up, Vincent. Please allow me to respond point-by-point to your additional concerns.

You posted:
I have been served already.

Do I need to pay for requesting documentations from seller's attorney? Could seller's attorney remove my name from the suit without I file a demurrer. OR if my name was removed, do I still have to file a response before deadline.
It would help to file a response anyway, but it would also require you to file motion to the judge requesting removal based on the fact that you were not a party to the business and they have no legitimate basis to pursue.



I wrote a letter to seller's attorney to request those documentations and also to remove my name from the suit but no response yet.
He does not have to remove you, you would likely need to retain counsel so as to file a motion for removal if he does not comply.



The deadline to file a response is near.

I don't want to spend money to file a demurrer since I knew but not confirmed that I were not binding the contract.
It may end up having to be a situation where you have little choice. The burden is on the other party to prove their case but similarly once named, the burden to show that you are not a party is technically yours to meet if you wish to be removed from the case.



I am thinking to file a counter lawsuit (frivolous) and fraud of sale if seller's attorney does not remove my name from the suit.
It is a possibility if the other party reasonably knew you were not a party to the suit--but please know that the burden is still on you to show that they not just knew but disregarded such information and filed anyway--so if by their information you were listed in some capacity, then they could claim the suit was not frivolous in nature.

Good luck.


Sincerely,

Dimitry, Esq.
Dimitry K., Esq., Attorney
Category: Business Law
Satisfied Customers: 38324
Experience: Run my own successful business/contract law practice.
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