Incomplete Business Name on Agreement?

hobbes1973

New Member
Jurisdiction
California
I have a simple 2 page Statement of Work that all clients sign before we engage with them for our PR work.

One client is refusing to pay their invoice and wants to terminate early.

When I point out they signed an agreement, they note two things that they think free them from the agreement:

1. The legal business name used in the agreement is incomplete. As an example, they told me their corporate name is Organics, Inc., which is what the agreement says. Last night I researched that their official corporate name is actually Acme Organics Inc. (just as an example). Will this oversight on my part nullify the entire agreement?

2. The owner who signed the agreement says he's not an American citizen but rather an Indian citizen, so I would have to file a suit in India. However, the company he signed on behalf of as the owner is incorporate in the State of New Jersey. He says since he is not a domestic rep for the company, his signature doesn't legally bind him or the company.

3. The amount is $5,000. As that would quality for Small Business Court, does that mean they cannot use a lawyer but instead must represent themselves?

Thank you!
 
1. The legal business name used in the agreement is incomplete. As an example, they told me their corporate name is Organics, Inc., which is what the agreement says. Last night I researched that their official corporate name is actually Acme Organics Inc. (just as an example). Will this oversight on my part nullify the entire agreement?

No.

The contract will be enforced by the court based on the intent of the parties.

2. The owner who signed the agreement says he's not an American citizen but rather an Indian citizen, so I would have to file a suit in India. However, the company he signed on behalf of as the owner is incorporate in the State of New Jersey. He says since he is not a domestic rep for the company, his signature doesn't legally bind him or the company.

He's full of you-know-what.

3. The amount is $5,000. As that would quality for Small Business Court, does that mean they cannot use a lawyer but instead must represent themselves?

Lawyers are not permitted to appear in California small claims court. But there is nothing to stop a participant from consulting and getting coached by a lawyer.

A word of advice: Don't take legal advice from the enemy.
 
1. Probably not (although it's not as simple as the prior response suggests), but you should have looked at this before performing any work. A corporation search online takes less than 30 seconds.

2. Not quite sure what to make of this. First of all, in the first sentence of your post, you said that you have this contract that you have clients sign "before we engage with them." Who are "we"? Second, you tagged your post as relating to California, so I assume that's where you're located. However, the other party is apparently a New Jersey corporation. Does your contract have a forum selection provision (i.e., a provision that specifies where any lawsuit will need to be filed)? If not, then you'll probably need to sue in New Jersey. That the person who signed the contract is a citizen of India is of no relevance whatsoever. As for whether he is authorized to bind the corporate party to the contract, who knows? What steps did you take before starting work to ensure that the signer had such authority?

3. I don't know what you mean by "Small Business Court." I also don't know who "they" are. While lawyers are not permitted to represent clients in California small claims court, they are permitted in most states' small claims courts (I don't know about NJ specifically, but most of the states that don't permit attorneys are in the western part of the U.S.
 
1. Probably not (although it's not as simple as the prior response suggests), but you should have looked at this before performing any work. A corporation search online takes less than 30 seconds.

REPLY: Yes, I've learned that lesson the hard way and will do so in the future. Complete failure on my part.

2. Not quite sure what to make of this. First of all, in the first sentence of your post, you said that you have this contract that you have clients sign "before we engage with them." Who are "we"? Second, you tagged your post as relating to California, so I assume that's where you're located. However, the other party is apparently a New Jersey corporation. Does your contract have a forum selection provision (i.e., a provision that specifies where any lawsuit will need to be filed)? If not, then you'll probably need to sue in New Jersey. That the person who signed the contract is a citizen of India is of no relevance whatsoever. As for whether he is authorized to bind the corporate party to the contract, who knows? What steps did you take before starting work to ensure that the signer had such authority?

REPLY: "We" is my public relations agency. I am the Managing Partner who signs agreements. Yes, we have this clause in our agreements:

6. DISPUTES BETWEEN THE PARTIES:

(b) Venue: The venue where any dispute shall be maintained is the County of Orange, State of California, United States of America.

I didn't do any due diligence beforehand to ensure the signer had authority. In the future, what should I request in this regards?

3. I don't know what you mean by "Small Business Court." I also don't know who "they" are. While lawyers are not permitted to represent clients in California small claims court, they are permitted in most states' small claims courts (I don't know about NJ specifically, but most of the states that don't permit attorneys are in the western part of the U.S.

REPLY: Sorry, Small Claims Court.
Thank you for your response!
 
The level of diligence you should do depends on a lot of factors, including the amount of work you will be doing.

Out of curiosity, does this New Jersey corporation conduct business in California such that, if you get a judgment in the court in California, you'll be able to try and enforce the judgment in California?
 
The level of diligence you should do depends on a lot of factors, including the amount of work you will be doing.

Out of curiosity, does this New Jersey corporation conduct business in California such that, if you get a judgment in the court in California, you'll be able to try and enforce the judgment in California?

Generally my agreements are all for monthly retainers ranging from $5k to $10k per month.

The NJ corp has an online business. They are a wholesaler of food and natural ingredients across the country, which you can order from their website.
 
I guess I could have asked my question differently: Does this company have a physical location and/or assets in California? The most common ways to enforce a judgment against a corporation are levies on bank accounts and accounts receivables. If the company has none of that in California, then suing and enforcing a judgment may prove not to be cost effective.
 
I guess I could have asked my question differently: Does this company have a physical location and/or assets in California? The most common ways to enforce a judgment against a corporation are levies on bank accounts and accounts receivables. If the company has none of that in California, then suing and enforcing a judgment may prove not to be cost effective.

I do not believe they have either in California.

Recently I ran into a similar situation with a company in Utah. I agree that it was a lot of work to get a CA judgment approved and enforced in a different state.
 
If the company does business in California and the contract was made in California then I would expect a California court would have jurisdiction.

Is the company registered with the CA Secretary of State? You can verify that online. Whoever their registered agent is should be responsible for their legal matters in CA.
 
If the company does business in California and the contract was made in California then I would expect a California court would have jurisdiction.

This is true, but California small claims courts lack jurisdiction over non-resident defendants except in cases involving motor vehicle accidents that occurred in the state and cases involving real property owned by a non-resident. Therefore, this suit would have to be filed in the limited jurisdiction division of the superior court.
 
Well that just sucks, like the rest of California.


I am not prone defend California.

Small claims courts tend not to be courts of record.

They are generally the lowest jurisdictional courts in all states.

That said, small claims courts lack the ability to enforce service, should someone who has been served decides NOT to leave Wyoming and travel to California over a $300 dispute.

Texas JP courts and Muni Courts are powerless to command a resident of New Jersey to appear in Texas for a small claims matter.

Small claims courts are across our nation are toothless tigers, even when you sue the crooked rascal across the street from your home.
 
I am not prone defend California.

Small claims courts tend not to be courts of record.

They are generally the lowest jurisdictional courts in all states.

That said, small claims courts lack the ability to enforce service, should someone who has been served decides NOT to leave Wyoming and travel to California over a $300 dispute.

Texas JP courts and Muni Courts are powerless to command a resident of New Jersey to appear in Texas for a small claims matter.

Small claims courts are across our nation are toothless tigers, even when you sue the crooked rascal across the street from your home.

Is the flip side of that to mean that if you do want to add "tooth", you need to sue them in a higher court?

Is that even allowed if the amount is small? I guess the cost of legal fees would also have to be factored in versus the amount disputed.
 
Is the flip side of that to mean that if you do want to add "tooth", you need to sue them in a higher court?

Is that even allowed if the amount is small? I guess the cost of legal fees would also have to be factored in versus the amount disputed.


A court of record could require an out of state defendant to appear.

However, attaching his or her assets in another state is still a difficult feat.

In your case the amount you allege to be owed is rather small, which makes hiring an attorney financially unsound.

It also makes it harder for a plaintiff to litigate pro se against the defendant's lawyers.

I have been where you are.

With small amounts, I write them off for tax purposes as losses (uncollectable debt).
 
A court of record could require an out of state defendant to appear.

However, attaching his or her assets in another state is still a difficult feat.

In your case the amount you allege to be owed is rather small, which makes hiring an attorney financially unsound.

It also makes it harder for a plaintiff to litigate pro se against the defendant's lawyers.

I have been where you are.

With small amounts, I write them off for tax purposes as losses (uncollectable debt).

I think what I've learned the hard way as a small business owner is that, some unscrupulous companies know this and will use it to their advantage to stiff on invoices.

I have also learned one tactic that does sometimes force them to settle. I post on my company blog and on Youtube my honest experience with them and how they haven't paid me. Once they see that this ranks high on Google for their name, they often are ready to settle. They calculate that it's not worth the hit to their online reputation. It's worked three times for me over 14 years...
 
I think what I've learned the hard way as a small business owner is that, some unscrupulous companies know this and will use it to their advantage to stiff on invoices.

I have also learned one tactic that does sometimes force them to settle. I post on my company blog and on Youtube my honest experience with them and how they haven't paid me. Once they see that this ranks high on Google for their name, they often are ready to settle. They calculate that it's not worth the hit to their online reputation. It's worked three times for me over 14 years...


As a name partner, and founder of a law firm, along with several businesses, and a working cattle ranch; I've learned to seek a retainer from businesses I have no prior relationship with.

I'm in business to make money, not post negative comments.

In the future ask for prepayment from unknown sources.

Better not to do work than to do work and NOT get paid.
 
This is true, but California small claims courts lack jurisdiction over non-resident defendants except in cases involving motor vehicle accidents that occurred in the state and cases involving real property owned by a non-resident. Therefore, this suit would have to be filed in the limited jurisdiction division of the superior court.
Well that just sucks, like the rest of California.

California is hardly unique in not allowing or limiting suits against non-residents in small claims court.

Small claims courts are across our nation are toothless tigers, even when you sue the crooked rascal across the street from your home.

I disagree (at least as it concerns small claims court in California). A $300 small claims judgment is enforceable in the same manner as a $3 million dollar judgment rendered in the unlimited division of a superior court.

Is the flip side of that to mean that if you do want to add "tooth", you need to sue them in a higher court?

Sigh...as I've already explained, a California small claims court will not have jurisdiction in your case. That means you'd have to sue in the limited division of the superior court (you could, in theory, sue in the unlimited division, but there would be adverse consequences to doing so) or in New Jersey. The notion that any court is "higher" or "lower" than another court makes no sense, and see my comments above about the suggestion that small claims courts are "toothless." In California, all courts are superior courts. Each superior court has divisions (as it relates to civil lawsuits): the unlimited division, the limited division, and small claims. The only differences are that, in the limited division and small claims courts, the amount for which one may sue is restricted, and those courts have rules designed to streamline litigation. A judgment is a judgment, regardless of the division in which it is rendered.

Here's my observation about your situation: The amounts you are dealing with make litigation cumbersome. That might be fine for a defendant in California, but it will make litigating against non-resident defendants prohibitively expensive. For that reason, you probably should consider requiring up front payment.
 
Here's my observation about your situation: The amounts you are dealing with make litigation cumbersome. That might be fine for a defendant in California, but it will make litigating against non-resident defendants prohibitively expensive. For that reason, you probably should consider requiring up front payment.

I do require upfront payment. I invoice at the beginning of each month for that month's services. This client had made 2 payments but not the 3rd. I've also started thinking about attaching an appendix that asks for their credit card information and authorizing us to charge that card if they are late past 30 days. Not sure if that is legal?
 
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