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socrateaser
socrateaser, Lawyer
Category: California Employment Law
Satisfied Customers: 33504
Experience:  Retired (mostly)
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I am in California and have my insurance license. My specialty

Customer Question

I am in California and have my insurance license. My specialty is selling fixed indexed annuities. The couple I began working with about 2 years ago had me sign an agreement. I need someone to look it over and tell me if (1) it is an illegal agreement in CA, and (2) how I can break it and work on my own. The agreement is 9 pages long. I also work in NV on this.
Submitted: 2 years ago.
Category: California Employment Law
Expert:  socrateaser replied 2 years ago.
You can scan the agreement into a .pdf file, upload it to www.mediafire.com, and then post a link to the files in your next Reply in this Q&A session.

Please provide some specific questions to narrow the focus of your concern.

Also, please redact any confidential matters (names, addresses, etc.).

Re charges, your question displays a value of $49.00. Nothing else is required.

Thanks in advance.

Expert:  socrateaser replied 2 years ago.
I think you are misunderstanding how this system works. No correspondence can be had between experts and customers other than via this Q&A interface. No direct email, fax, phone, text video or any other transmission medium is permitted.

If you don't want to upload to www.mediafire.com, I certainly understand. However, it is the only method of which I'm aware, via which you can transmit the file.

The choice is yours. Thanks for your understanding and cooperation.
Customer: replied 2 years ago.

I will try to do this. Let me know, of course, if I get it to you.

 

Debbie

Expert:  socrateaser replied 2 years ago.
When you post the link to the www.mediafire.com files, that will notify me of your success.

Note: Please do not Reply directly to this memo, until you have uploaded the files and you provide the link. I need to have this Q&A unlocked in the interim so that I may conduct other business.

Thanks.
Customer: replied 2 years ago.
I think I have sent you the link. Please let me know if you have received it.
Expert:  socrateaser replied 2 years ago.
Nope.

All you need to do is copy the link from the website, and then paste it into your next Reply here. If you can see it in your Reply when you are typing, then when you click Reply, the link will be sent with your Reply.

:)
Customer: replied 2 years ago.
IT HAS BEEN SENT!
Expert:  socrateaser replied 2 years ago.
I will have customer service contact you. Maybe they can assist.
Customer: replied 2 years ago.

http://www.mediafire.com/download.php?4aqtbgpz5qn673n

 

I hope this is it! I need an answer by today or tomorrow at the latest, as I have to put things in motion.

Expert:  socrateaser replied 2 years ago.
Okay, thanks -- I have it.

I presume your concern is over Section 8 through 8.3.

Section 8 is enforceable against you.
Section 8.1 violates Bus. & Prof. Code 16600 and is unenforceable, because it is an attempt to restrain your ability to compete after the contract terminates.
Section 8.2 is likewise unenforceable.
Section 8.3. is enforceable to the extent that you would disclose the company's customer lists. However, if you independently contact the clients and vendors from your own memory and using publicly available resources to obtain their contact information, then the Section is unenforceable, also in restraint of trade under Bus. & Prof. Code 16600.

Section 7 is important, because everything in Section 8 of the agreement is enforceable against you until the agreement terminates. Thus, if you provide 30-day written notice of termination to the other party (i.e., on March 4, 2012), then on April 3, 2012, you are free to do whatever you wish, subject to my explanation re Section 8-8.3, above.

Section 11.2 makes the contract subject to the laws of the State of South Dakota. This clause is also unenforceable, because the contract was intended to be performed in California (I assume that's where you have been selling the product). Were contracting parties able to avoid California law by simply making their contracts to be performed in California subject to the law of a different jurisdiction, no one would ever have to follow California law.

One other thought is that this contract, despite its being called an independent contractor agreement, is almost certainly an employment contract, because it clearly restricts the independent contractor's independence in Section 7, and it is actually terminable "at will," by the company under Section 7.3, as it provides the company unlimited discretion as to the reason for termination. Which means that if the company were to give you difficulties, you could simply file an IRS Form SS-8 with the IRS, a Cal. BOFE complaint form, and a Cal. EDD Form DE 660, and the company would be in an incredible amount of trouble for failing to remit payroll taxes (FICA, unemployment insurance, workers' compensation, SDI, etc.).

Hope this helps.


And, if you need to contact me again, please put my user id on the title line of your question (“ToCustomerrdquo;), and the system will send me an alert. Thanks!

socrateaser, Lawyer
Satisfied Customers: 33504
Experience: Retired (mostly)
socrateaser and other California Employment Law Specialists are ready to help you
Customer: replied 2 years ago.

Please let me know if Section 8.4 is enforceable. They have all of my client info already and know to the penny what has been sold.

 

Also, I presume that they will have to forward all commissions to me when due.

 

Does Section 7 make it necessary for me to wait until March 3rd to give them 30 days notice?

 

Please address anything else that is important.

 

Thank you!

Expert:  socrateaser replied 2 years ago.
Please let me know if Section 8.4 is enforceable. They have all of my client info already and know to the penny what has been sold.

A: Yes, I believe that Section 8.4 is enforceable. It doesn't prevent you from competing -- it merely operates to secure the confidentiality of the company's business dealings.

Also, I presume that they will have to forward all commissions to me when due.

 

A: If you have earned the commission prior to termination (everything necessary to make the sale is accomplished), then you are entitled to be paid. This issue is notorious for starting a war after contract termination, because the company never pays voluntarily.

Does Section 7 make it necessary for me to wait until March 3rd to give them 30 days notice?

 

A: Section 7 is poorly written. On its face it requires that notice be given only on the date 30 days before contract renewal. I doubt that anyone would interpret the agreement in that manner -- so, you could send notice now and see what they say. However, the letter of the contract requires notice be provided on March 3.

 

Please address anything else that is important.

 

A: Nothing else comes to mind.

 

Hope this helps.

 

 


And, if you need to contact me again, please put my user id on the title line of your question (“ToCustomerrdquo;), and the system will send me an alert. Thanks!


 

Customer: replied 2 years ago.
I clicked Accept Answer when I was trying to ask above additional questions. If I accept your answer, will I be charged again?
Expert:  socrateaser replied 2 years ago.
My apologies. The system tries to solicit payment from you everytime I post another Answer. You've paid already, and I'm not expacting anything further.

Happy New Years.



Expert:  socrateaser replied 2 years ago.
Edit: In my second Answer here, I see that somehow the 30-day notice date in the discussion changed from March 4, to March 3, 2012.

To clarify, 30 days before April 3, 2012 is March 4, 2012.

Best wishes. [no need to respond to this memo.]

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