Bankruptcy Question
Ok, I signed a contract with a company that basically pays me a sum every week to provide them with certain services. The contract I signed is a 7 year agreement. I knew what I was signing when I signed it, but I don't the the comany did. Nevertheless, it appears they are selling the assets of their corporation to a separate corporation, which is run by their daughter. I can only assume that they plan on filing bankruptcy.
If they do file bakruptcy, and have very little assets to sell, or no assets, then I would be left with nothing but a very lucrative piece of toilet paper.
Any ideas?
Can I go after the officers of the corporation (c corp in NY)?
Should I offer s settlement now?
Is this fraud? Or an attempt at fraud?
I know that they plan on doing this slowly, maybe over the next year, so I'll get paid untill they do this.
It's not a huge loss for me if they do go out, but I still want to protect myself and get what I can!
Thanks
Probably no personal liability on and of corp. officers, unless they personally signed guaranteeing their corp. debt.
I've seen some real cuties in this vein: the corp officers DO sign, but very carefully have written in "As Secretay of ZBC Corp", only...so no personal liability there.
I was working with a young entrepeuner in TX who'd sold a going night club he'd started from scratch and built into a really jiving hotspot....and he thought HE knew what he was doing when he took a note just like that...and then, a couple of years later, when the computer millionaires tired of playing with their new toy, they dunped it into BK and walked away, owing him nothing!
So basically, if they decide to bankrupt the company, and there are no assets to sell, I'm screwed huh.
Question, what recourse do I have if they breach their contract? Maybe I can clarify....
In the contract it says that and discrepancies regarding the contract will be settled in arbitration. I know it's difficult to tell who would win arbitration regarding this matter, but is there a way that I can "simulate" arbitration myself?
It might be worth it for me to hire a lawyer to see if they can predetermine the outcome of the arbitration before I tell them that I want to go there.
Has anyone ever done anything like this?
Thanks again
While a lawyer might pretty accurately predict what a judge or arbitrator will do, there's no way he's going to be cutting any deals with the arbitrator, or pre-arranging the outcome.
That's about the same as buying a judge, and seems to be a crime everywhere.
Quote:
On 2004-01-28 22:56, gamado wrote:
So basically, if they decide to bankrupt the company, and there are no assets to sell, I'm screwed huh.
Even if there were, the trustee is going to spread those assets amongst all their debtors. Taxes and liens on property will always be on the top of the hierarchy. As for your other questions, I defnitely cannot answer.
Thank you for the responses. I didn't mean to say that I planned on buying hte judges, only that I would like to know how the arbitration would "hypothetically" rule in this case. Do my homework so to speak.
Any arbitrator is going to do his best to follow the law, so whatever rights the law sets out will be enforced.
Job of official Arbitrator is to get the parties together and try to cut through the junk and bring about a quick conclusion without a trial...but again, the A is going to find as the law rules, not just according to how he/she is feeling that day.
If I can chime in here...
Seems to me that what you really see is that the management of the business is 'winding it down.' Not all businesses end in bankruptcy, by any means.
I don't think that there will be a whole lot for you to gain in getting into some legal battle. You have "a contract with a company that basically pays me a sum every week to provide them with certain services." You're being a little mysterious here, but to the extent that the company ceases to do business, you will cease to provide the services, no? And in that case, they don't owe you for the services, either. Now, if that happens, they may have broken their contract to buy services from you. And legally you might be entitled to collect some liquidated damages (what's the contract say??) but if they really do go bankrupt as you suggest (only reason would be if liabilities exceed assets) then surely you would be last in line to get paid for anything, since you haven't yet earned it, right?
But none of this has even happened yet, right? You're still providing services, and they're still paying you to do so. I don't think it's worth it to lose sleep or spend money on legal services until the contract is in default, and then it's specified that you'll use arbitration.
You're trying to guess what will happen WRT your contract. Maybe you should just ask them. Tell them that it appears that they're winding down the business and you would like to know their intentions. Good luck
btw: let me guess. You run their in-house day care.
Thanks for the continued replies. I don't provide them with daycare in their home, as they are a business.
Nonetheless, I appreciate the advice that I've gotten from everyone.
Essentially what I was trying to figure out was what recourse I had in the event that the business failed. And I guess I will simply go to the end of the line of creditors, waiting to get a piece of nothing.