Anyone with experience w/ contract law/ethics? (Not UPS-related)

Discussion in 'Current Events' started by mattyk624, Sep 18, 2015.

  1. mattyk624

    mattyk624 New Member

    So, without getting into too many unnecessary details, a hairy situation recently arose between a friend/client of mine regarding a business trip I funded him for this Summer.

    Basically what I do is invest in people with proven track records to take my money and invest it in short-term high-risk/high-reward business ventures across the country where/when I feel it's worthwhile. There's a lot more to it, but that's what's pertinent to this issue specifically. I only have a handful of well-trusted people who I do this with, all of which I consider friends above employees/clients. We all have significant experience and success in this kind of work, but recently I've decided to take on the role of funding their efforts, of which they receive x% commission on their personal profitability. A :censored2:ty situation came up with one of my employee's maiden mission, which consisted of 4 weeks being spent 2500miles from home, and I'm not sure how to resolve it.

    Everyone receives the same guidelines regarding traveling: That 1/2 the cost of all expenses incurred as 'travel expenses' shall be credited as a loss that needs to be overcome before any profit split takes place. Example: Joe takes a trip and accrues $950 in expenses. Joe profits $1500 while on said trip. $475 (1/2 of his expenses) are deducted from that $1500, leaving $1025 which will be divided between him and I based on our agreement. The reason for this is because they're not investing any $ of their own into the venture, but since they are expected to show a profit it helps me keep expense costs down while not giving them too insurmountable of a deficit to overcome.

    So I send Joe off to do his thing out West (Joe is a proven horse with a third of his life experience and results to boot) along with the agreement seen above. Since we've all been doing this for some years now, I simply spoke to him prior to the trip and said something to the effect of "Same deal, expenses are on the fund, 1/2 to be paid back before 'chopping'".

    Joe comes back a month later, and presents me with a detailed list of his expenses whilst away. Included are several lavish meals, a night on the town with a friend for his birthday in which he treated generously, a $250 limo ride (to a concert 1/3 of the price which I agreed to treat him to, the limo was his decision), and even a $120 trip to an Asian massage parlor, the details of which I didn't care to ask for. The net on the trip (which I'm not going to attribute to the good time he apparently had) was a loss....and so as predicated, I'm to eat the expenses. I tried to argue that a few of the obvious entries WERE NOT 'expenses' and that he should repay me for those, separate from our business agreement. He stands his ground that my offering to cover his expenses should include everything, even those I saw as exorbitant.

    My error was handling this newfound business idea a little too informally because I had worked with these people so much prior to taking it on, and not having a written binding contract with 'expense' clearly defined therein. Given the formality of our agreement (or lack thereof), do I have any legal leverage to wage in a situation like this? For this particular amount of $, I'm not going to pursue legal action either way, but if I can prove to him in some way that I'm in the right (and not just ethically), it would make me feel better and probably end in him reimbursing me. Until then, I hope it's a matter of him really thinking he's right here rather than taking advantage of some loophole I was too trustworthy too make sure I had covered. However it plays out, at least I got to see his true colors and learned to be more thorough with where my investments end up in the future.

    Thanks for reading and I appreciate any feedback, enjoy your weekends! :teethy:
     
  2. retiredTxfeeder

    retiredTxfeeder cap'n crunch

    I've got no experience with the law, well, other than a couple of speeding tickets. Since I am retired, I DO watch Jude Judy and People's Court daily. Sounds like your friend took advantage of you. Without having guidelines set on what constitutes legitimate expenses, I believe this employee cannot be trusted. If this setup has worked for you in the past, keep on keeping on, just without this employee and his never ending expense account. Pay the expenses and learn a lesson. Good luck to you.
     
  3. trickpony1

    trickpony1 Well-Known Member

    Wouldn't it have been easier to have a contract, on paper, that the parties sign, in the presence of a notary, so there are no misunderstandings?
     
  4. UpstateNYUPSer

    UpstateNYUPSer Very proud grandfather.

    The parties in the OP's agreement are what Judge Judy refers to as litigants.
     
  5. Sportello

    Sportello Well-Known Member

    Google 'oral contract'.
     
  6. BrownArmy

    BrownArmy Well-Known Member

    Take the hit, and don't work with this guy again.
     
  7. burrheadd

    burrheadd Superstar

    There are easier ways to get your weed across the country
     
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  8. Big Arrow Down...D

    Big Arrow Down...D Leave the gun,take the cannoli

    $120 to an Asian massage parlor?
    I wouldn't have spent a penny over $60...must've gotten a 2 fer...
     
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  9. Turdferguson

    Turdferguson Guest

    Depending on what country the,Asians were from I could see $120.00
     
  10. rod

    rod retired and happy


    We need pictures to determine if this expense was reasonable.
     
  11. rod

    rod retired and happy


    I think you hit the nail on the head.
     
  12. rod

    rod retired and happy


    It used to cost us 5 bucks or some American cigarettes when I was in Vietnam. Can you say inflation?
     
  13. mattyk624

    mattyk624 New Member

    I stated in my last paragraph that doing this would've been the best way to prevent problems of this nature...but since I didn't, I'm now at a position where basically all we're arguing is the definition/interpretation of 'expense'. If for instance his 'night on the town' included stopping by a casino and dropping $100,000 playing Blackjack, or had he went and bought a new pair of Mercedes' for him and the wife, is his argument of how he interpreted an 'expense' just as valid? Just trying to figure out if and where a line exists between being responsible for my own negligence and being blatantly stolen from. My knowledge goes about as far as yours (Personally starting to favor Peoples Courts Judge Milian over Judy....shes gettin crabby)...and I'm certain I, as the would-be contractor, am responsible for making sure at the time of the agreement that I'm protected from such situations arising. But to not have any legal or financial protection whatsoever from such reckless opportunism by a contractee who found a loophole also doesn't sound reasonable.
     
    Last edited: Sep 19, 2015
  14. mattyk624

    mattyk624 New Member

    Not the worst guess...you're in the 'Widespread Lack of Social Acceptance' ballpark.
     
  15. mattyk624

    mattyk624 New Member

    I'm pretty resigned to doing so...was just curious hypothetically how far he coulda stretched this behavior and still not be at all legally accountable, given everything in our contract was as it appears in OP, but without clearly defining an 'expense' therein.
     
  16. UpstateNYUPSer

    UpstateNYUPSer Very proud grandfather.

    Barring a clear definition, a judge would determine whether the expenses were reasonable or excessive and would rule accordingly. The limo, concert and massage would all be deducted from the total expenses, with that sum divided in half per your agreement.
     
  17. Turdferguson

    Turdferguson Guest

    Black market organs?
     
  18. trickpony1

    trickpony1 Well-Known Member

    The law firm of upstate, upstate and upstate has spoken.

    Litigant.