QUESTION

Hello. My business partner took $5000 from the business bank account and used it as a deposit for a home he is renting.

Asked on Sep 13th, 2012 on Business Law - California
More details to this question:
I ran a small business with a business partner. I funded the business - while my business partner ran the 'day to day' office of the business. There were many 'shady' expenses that he said were for the business - that ran alarm bells. I didn't say anything as we were trying to grow the business - but I have just discovered that he took $5000 from the company bank account -- to pay for a deposit for his house. He lied and said it was for 'business expenses'. Foolishly I didn't ask for receipts -- and only now - 10 months later - have I discovered the truth. This incident cost me a further $5000 -- as I had to replace the original $5000 that he had stolen -- as we needed the original for a legitimate business expense Do I have a case to sue him for fraud? Thank you for your help with this.
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2 ANSWERS

Business Transactions Attorney serving Los Angeles, CA at Doland & Fraade
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It might be breach of fiduciary duty, it might be embezzlement. Small claims court is the perfect place for this claim.
Answered on Oct 30th, 2012 at 2:10 PM

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Litigation Attorney serving Greenwich, CT
Partner at Hilary B. Miller
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It sounds as if you have a legal claim against him, although claims of this small size are extremely difficult to collect on a cost-effective basis. You may wish to start simply by demanding the return of the money and threatening suit if it is not returned. Presumably you will need to renegotiate your partnership arrangement in any event, so this would be a good start.
Answered on Sep 13th, 2012 at 11:18 PM

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