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Ely
Ely, Counselor at Law
Category: Family Law
Satisfied Customers: 99981
Experience:  Private practice with focus on family, criminal, PI, consumer protection, and business consultation.
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I have a 50/50 partnership. One partner is using the joint

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I have a 50/50 partnership. One partner is using the joint account for personal use other than business expenses. Do I have recourse. We can't stop each other from accessing the account. Don't know to do. (In Pennsylvania.)
Hello, my name is Ely. Welcome to JustAnswer. Please note: (1) this is general information only, not legal advice; and (2) my function is to give you honest information and not necessarily to tell you what you wish to hear. Note: there may be a slight delay between your follow ups and my replies.

I am very sorry for your situation. Would you be willing to go to Court to stop them from doing this (which may mean breaking up the partnership), or, at least threatening to do so?

This is not an answer, but an Information Request. I need this information to answer your question. Please reply, so I can answer your question. Thank you in advance.
Customer: replied 3 years ago.

Yes. would love to threaten court but I have no point of reference or law to substantiate my threat...

D,

No worries. What I am going to do is to write out a sample threat letter that will incorporate that point of law, which then can clarify everything...

Apologies in advance for the momentary wait while I do so.
Customer: replied 3 years ago.

no problem...I am trying to proceed very cautiously and deliberately. So, take your time.

See example letter below:

Dear _____________,

This letter is in regards XXXXX XXXXX spending of company accounts on your own affairs and debts.

Demand is hereby made to cease and desist immediately.

If you do not cease and desist, I will be forced to possibly seek relief via both the civil and criminal justice systems.

CIVIL
As you may know, business partners owe each other a fiduciary duty. Said fiduciary duty includes the following from all business partners: (1) full disclosure of all information relating to the business and (2) obligation of utmost good faith. Other duties also exist.

Your actions arguably have constituted a breach of fiduciary duty, an actionable tort in Pennsylvania law (eToll, Inc. v. Elias/Savion Advertising, 811 A. 2d 10 - Pa: Superior Court 2002 - general discussion).

In addition, this also arguably is fraud. The elements of fraud are as follows: there must be (1) a misrepresentation, (2) a fraudulent utterance thereof, (3) an intention by the maker that the recipient will thereby be induced to act, (4) justifiable reliance by the recipient upon the misrepresentation, and (5) damage to the recipient as the proximate result. Delahanty v. First Pennsylvania Bk., NA, 464 A. 2d 1243 - Pa: Supreme Court 1983.

[IF THE COMPANY IS A CORP, THIS PARAGRAPH MAY BE INCLUDED]
Finally, the corporation may have a case of fraud and money had and received against you, separately. The elements of unjust enrichment are "benefits conferred on defendant by plaintiff, appreciation of such benefits by defendant, and acceptance and retention of such benefits under such circumstances that it would be inequitable for defendant to retain the benefit without payment of value." Styer v. Hugo, 619 A. 2d 347 - Pa: Superior Court 1993. While this is mostly used in contractual cases, it can apply here as well.

Punitive damages may also apply under 40 Pa. Cons. Stat. § 1301. 812-A.

CRIMINAL
These actions may be cause for embezzlement under 18 Pa. Cons. Stat. section 3927 and/or 18 Pa. Cons. Stat. section 3903.

If the funds are not restored back and the conduct ceases in __ days of your receipt of this letter, I may have no choice but to seek relief via the court.

Sincerely,

Signature

Name


Note, this is just a sample. Finally, the criminal threat is somewhat of a bluff in that unless they were taking money without knowledge, this does not apply, but, it is more of scare tactic.

I hope this helps and clarifies. Good luck.

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Ely and 4 other Family Law Specialists are ready to help you
Customer: replied 3 years ago.

I actually didn't know about it until recently...had a hunch...I really didn't want it to be so.... and harvested all deposits/withdrawl documents from our bank.


 


thanks. take care.


Dan S.

Oh Lord.

Well, I hope this ends amicably for you. Good luck.