If I’m a sole proprietor, can I sue the owner of a business for falsifying company profits payable to me?

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If I’m a sole proprietor, can I sue the owner of a business for falsifying company profits payable to me?

I partnered up with a construction comp to do work on a few houses. We verbally agreed to split profits after his company took 15%. On one house he was to pay me $3600, he only paid $1800. Stating that the builder ripped him off and he never got paid the other half, so his loss is mine. I have reason to believe he is lying and actually did get paid the full amount. I also believe he is falsifying numbers on other projects to make the profit seem smaller than what it is. His company has no assets, so I prefer to go after him on basis that he is committing fraud. He owes me $4000 that I know off

Asked on February 15, 2011 under Business Law, Indiana

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

You need to seek legal help in your area with all of this.  First, the fact that there is no agreement in writing makes things difficult to say the least.  If he decides to testify that the terms of the contract were different from your rendition it becomes a credibility issue for a judge or jury to determine.  Next, you admit here that you wish to go against him and not the company (which I am assuming is a corporation).  What you wish to do is known as "pierce the corporate veil."  This is not an easy task.  The whole reason that people incorporate is to protect themselves against personal liability. It is true that you can pierce it under certain circumstances but I would really sit down and speak with someone on this, even on a consultation basis.  Good luck.


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