Taking my former employer to Small Claims...PLEASE HELP

[Graciexo]

What is the name of your state? New York
So....I used to work for a very sketchy man, who ended up screwing over all of his employees, and leaving most of us with unpaid wages..Unfortunately, I stayed the longest, and ended up acquiring a lot of bills in my name (long story) and paying for the move to our new office etc. I havent worked for him since February 17th, but still have a balance of unpaid bills and wages of 7,500.00 (I decided to knock it down to 5k for small claims purposes) I had him sign a PERSONAL promissory note in January in case he were to bankrupt the company (although his books are REALLY not clean so i dont think he would have that option) So, tomorrow is court, and I am curious as to what happens if A) He doesn't show up, or B) He shows up and just says that he doesn't have the money?
I should also mention that he is way shady on the IRS side of things, between October 05' and the end of the year when he started paying me under the table (not my choice) he was paying me and the 6 other employees NETpay, and pocketing the difference in Net and Gross. Any help would be immensely appreciated, or any advice...or anything!
Thanks

 

[Graciexo]

I guess I should also add that filing unpaid wages with the department of labor didn't work...all of the other employees tried to do that, and he ignored all of the requests for payment.

 

[dcatz]

First, if he's that "sketchy?", your biggest concern might be that he has fabricated something to show that you've been paid. If not, why show up at all? Saying that he doesn't have the money isn't a defense.

I hope that you named and served both the company (for wages) and him (on the note). If all employees are gone, it doesn't sound like the company is long for this world. If you don't get both on the judgment, you'll just have to sue him personally later.

Assuming those two issues are out of the way, save every scrape of paper that you have related to the company, because your next biggest problem is going to be enforcing a judgment and all information can help.

Finally, if you're squeaky clean about reporting earnings, you might look into IRS whistleblower practices. Don't know much about them myself, but I understand they exist (maybe an urban myth).

 

[Graciexo]

ok, thanks..I'll look into it....
I don't think he could possibly fabricate the debt away. especially since I have the promissory note.
But, what will happen if the judge finds in my favor...and orders him to pay, and then he just doesn't ?

Also, what obligation does his wife have to pay? Considering that it is a personal promissory note...and she has money.?

 

[dcatz]

Statement: I don't think he could possibly fabricate the debt away. especially since I have the promissory note.

Response: Cross the bridges when you come to them. It was just a thought. If the consideration for the note was unpaid wages, and he offered evidence that the wages were paid, then the note is satisfied. At least that's how I read the post. There's no indication that the note was in consideration of some other obligation. You didn't make him a loan. It appeared that the note was, in effect, a personal guaranty of the company's debt (?).

Q. But, what will happen if the judge finds in my favor...and orders him to pay, and then he just doesn't ?

A. If you prevail, don't expect him to write a check on the spot. He could, but he doesn't sound like that kind of guy. And he's going to be given a period of time (probably something like 20-30 days for an appeal). Until that time has passed, you won't even have the right to involuntarily enforce the judgment.

Q. Also, what obligation does his wife have to pay? Considering that it is a personal promissory note...and she has money.?

A. Hard to say what, if any. We know nothing about his asset situation. I don't want to scare you but, from the way that you describe your ex-boss, judgment enforcement is probably going to be your biggest problem. It normaly is anyway for Small Claims litigants, and this might be especially difficult. If all of her assets are designated as separate, are held in trusts, she pays marital debt out of "separate property" etc., you are, very candidly, going to have a hard time. Someone who has sufficient resources and makes it their business to evade creditors can tie things up in knots that are hard, long and costly to unravel. And you have no experience.

That's why I say keep all the information you can lay your hands on and do some searching on this site for ways to enforce judgments. Again, worry about the problem when it arises (maybe you will be given a check) but, from your description, don't be surprised if it does. You may even need the services of a professional to trace funds and locate assets