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California Contracts Questions & Answers
5 Answers | Asked in Business Law, Contracts and Employment Law for California on
Q: Is it legal for a board member to use employees for another company?

I am part of a company in California where one of the board members has been directing our employees to work temporarily for another company he is involved in. This has been happening for at least 6 months, and we disagree with this practice as there are no formal agreements and the companies are... View More

Michael R Trust
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answered on Jun 12, 2025

Hello. As long as the Board approves it, and it's not ultra vires to the purpose of the original organization, it's legal. Now, if contracts are not being handled correctly or there's fraud, that's different. Good luck.

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5 Answers | Asked in Business Law, Contracts and Employment Law for California on
Q: Is it legal for a board member to use employees for another company?

I am part of a company in California where one of the board members has been directing our employees to work temporarily for another company he is involved in. This has been happening for at least 6 months, and we disagree with this practice as there are no formal agreements and the companies are... View More

Brad S Kane
Brad S Kane
answered on Jun 12, 2025

The situation you describe appears to be breach of fiduciary duty and misappropriation of corporate assets. You should immediately speak with the Corporation counsel as well as bring the issue to the Corporation's board.

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5 Answers | Asked in Business Law, Contracts and Employment Law for California on
Q: Is it legal for a board member to use employees for another company?

I am part of a company in California where one of the board members has been directing our employees to work temporarily for another company he is involved in. This has been happening for at least 6 months, and we disagree with this practice as there are no formal agreements and the companies are... View More

Pavel Kolmogorov
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answered on Jun 12, 2025

Generally speaking, the situation you've described is not allowed. Here are the main issues I see:

1. Director’s Breach of Duty: Directors must act in the best interests of their company and its shareholders. Using the company's employees for another business without proper...
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2 Answers | Asked in Contracts and Employment Law for California on
Q: Early termination of an at-will contract due to alleged poor performance without evaluation.

I had an "at will" one-year contract with a company, which was terminated early due to alleged poor performance. During my 7-month tenure, I never received any feedback or performance evaluation. There were no discussions or formal reviews concerning my work. Is this early termination... View More

Michael R Trust
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answered on Jun 3, 2025

Hello. You can't be "at-will" and under a contract at the same time. It's one or the other. If you were at-will, you can be terminated for no reason or any reason, so long as the reason is not illegal (which based on what you wrote, it isn't), with or without notice. If you... View More

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2 Answers | Asked in Personal Injury, Civil Litigation and Contracts for California on
Q: Is my friend liable for damages after my travel trailer crashed during transport in California?

I asked a friend to move my travel trailer because my truck was down. While driving too fast on back country roads, he lost the trailer off his truck, and it crashed, rendering the trailer unusable. There was no formal agreement between us, and my girlfriend witnessed the incident. The county... View More

William John Light
William John Light
answered on Jun 3, 2025

If you had comprehensive insurance on the trailer, it will be easier to go through your own insurer. You can bring a claim against your friend if he was negligent. His liability insurer should cover the loss, up to its liability limits. If neither of you had insurance, well, good luck collecting.

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2 Answers | Asked in Consumer Law and Contracts for California on
Q: What are my options to cancel the payment through Affirm for an undelivered online purchase?

I purchased an engine online using Affirm on May 7, but the merchant has not provided a tracking number or proof of shipment. The promised delivery date was May 15, but it is now May 29, and I have not received the item. The merchant accused me of scamming to cancel the order. I started a dispute... View More

Daniel Timothy LeBel
Daniel Timothy LeBel
answered on May 29, 2025

Sorry to hear you are apparently being taken advantage of by Affirm and/or this merchant. A professional legal analysis would require more facts and a review of Affirm and the merchant's terms of service. However, it seems patently unfair that a failure to respond by the merchant triggers an... View More

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3 Answers | Asked in Employment Law and Contracts for California on
Q: Can I negotiate severance and take action for termination due to ethical restrictions?

I recently accepted an offer for an exempt position at a company after leaving my city government job. The offer included an "at-will" employment clause allowing termination without cause. Prior to and during the interview, I verbally informed the company about my ethical restrictions... View More

Michael R Trust
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answered on May 27, 2025

Hello. Did your offer letter confirm or reference these restrictions? That would've been ideal.

You can try to negotiate anything. Severance isn't required by law. I would think that the company would want to give you generous severance package, however, due to what's...
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3 Answers | Asked in Employment Law and Contracts for California on
Q: Can I negotiate severance and take action for termination due to ethical restrictions?

I recently accepted an offer for an exempt position at a company after leaving my city government job. The offer included an "at-will" employment clause allowing termination without cause. Prior to and during the interview, I verbally informed the company about my ethical restrictions... View More

Neil Pedersen
Neil Pedersen
answered on May 27, 2025

You can always try to negotiate a better severance payment, but there is no legal right to more money. In fact, you are not entitled to any severance, even under these conditions. You became employed at will which means you can be terminated at any time and for any reason or even no reason at... View More

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3 Answers | Asked in Employment Law and Contracts for California on
Q: Am I entitled to compensation at my old pay rate after department dissolution mid-pay period?

My department was dissolved without notice, and I was given 26 hours to choose whether to accept a pay cut or leave. I chose the pay cut. The dissolution occurred mid-pay period; one week I worked under my previous pay rate and the next week under the new lower rate. I received no documents to sign... View More

Brad S Kane
Brad S Kane
answered on May 23, 2025

Your employer can only reduce your pay prospectively. Thus, you are entitled to be paid at your old higher rate until the date you agreed to the lower rate. You can file free online a complaint with Labor Commissioner for the difference.

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3 Answers | Asked in Employment Law and Contracts for California on
Q: Am I entitled to compensation at my old pay rate after department dissolution mid-pay period?

My department was dissolved without notice, and I was given 26 hours to choose whether to accept a pay cut or leave. I chose the pay cut. The dissolution occurred mid-pay period; one week I worked under my previous pay rate and the next week under the new lower rate. I received no documents to sign... View More

Michael R Trust
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answered on May 21, 2025

Hello. If you're non-exempt, you're entitled to one pay period of notice for a pay change. If you're exempt, you're not legally entitled to any notice. If you were exempt, and told, told that week one would be at the old, higher rate, then that's what should have happened.... View More

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2 Answers | Asked in Estate Planning, Real Estate Law and Contracts for California on
Q: Can a trust alter community property terms post-transfer?

If the deed is vested as community property with the Right of Survivorship, and we then transfer the property into a trust, can the trust stipulate that the community property status no longer applies? Additionally, can the initial down payment and its proportional return on the investment be... View More

Klaus Gottlieb
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answered on May 20, 2025

Transferring community property (even if titled with right of survivorship) into a trust does not change its community property character unless there’s a valid transmutation agreement signed by both spouses under California Family Code §§ 850–852. However, placing the property into a trust... View More

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3 Answers | Asked in Contracts and Employment Law for California on
Q: Does Section 925 apply to 1099 independent contractors in California?

I am a California resident and independent contractor entering into a contractor service agreement. The agreement includes a governing law clause stating that the agreement will be governed by the laws of the State of Virginia, and that the courts of Virginia shall have exclusive jurisdiction over... View More

Neil Pedersen
Neil Pedersen
answered on May 19, 2025

If you really were not an employee, and were properly classified as an independent contractor, you do not get the protections of the California Labor Code. Sorry.

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3 Answers | Asked in Contracts and Employment Law for California on
Q: Does Section 925 apply to 1099 independent contractors in California?

I am a California resident and independent contractor entering into a contractor service agreement. The agreement includes a governing law clause stating that the agreement will be governed by the laws of the State of Virginia, and that the courts of Virginia shall have exclusive jurisdiction over... View More

Michael R Trust
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answered on May 19, 2025

Hello. 925 only references "employee". A 1099 contractor is not an employee, so 925 would not apply. There is a clause about a contract and having it negotiated or being represented by an attorney, but that still references the person as an "employee". Good luck.

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2 Answers | Asked in Business Law and Contracts for California on
Q: Is the Manager's conduct lawful in altering contact without notice in a CA LLC?

I am a member of a California LLC with 55 members, managed by another LLC. Our operating agreement specifies a contact for the Manager, but this was changed without notice or consent. Now, I can only communicate through an Investor Relations team that neither provides Manager access nor answers my... View More

Pavel Kolmogorov
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answered on May 16, 2025

The manager's conduct in changing the contact method without notice or consent may not be lawful under California LLC laws and the operating agreement, depending on the specific terms of the operating agreement and the manager's fiduciary duties. California law provides that the operating... View More

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3 Answers | Asked in Car Accidents, Contracts, Insurance Defense and Personal Injury for California on
Q: Am I responsible for car accident damages if insurance lapsed without my knowledge?

I was driving a vehicle that was gifted to me, but it is in my ex’s name. I recently got into a fender bender and found out that the insurance coverage for the car was removed a year ago without my knowledge. The car was purchased for me in February 2023, and my ex had been paying for the... View More

William John Light
William John Light
answered on May 16, 2025

If it’s in your ex’s name, it might be his car. However, you were driving. You had an accident. It’s your responsibility. It’s also your ex’s responsibility as the apparent vehicle owner who let you drive the car with his permission.

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2 Answers | Asked in Contracts, Estate Planning and Real Estate Law for California on
Q: I have a question concerning the validity of a Transfer on Death (TOD) deed in California.

The situation involves a TOD deed, signed by my now-deceased parent on October 2nd, 2023, witnessed by two non-relatives. The notarization was completed separately ten days later on October 12th, 2023, and signed by my parent's valid Power of Attorney (POA), one of the daughters who is an... View More

Julie King
Julie King
answered on May 14, 2025

There are two types of notarizations a notary may use: (1) jurats; and (2) acknowledgments. [You only need to know the names. Don’t worry about what they mean unless you plan to become a notary.] Notaries must follow different rules for each type of notarization.

Most commonly, real...
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3 Answers | Asked in Contracts and Employment Law for California on
Q: Do I owe penalties for delayed payment due to holiday postal delay to a temporary worker in California?

I hired a temporary worker for a 3-day evaluation period and sent his payment two days after his last working day. Due to the Thanksgiving holiday, the postal service delayed the payment, and he received it late. We communicated via text, but there was no formal contract. Now, the worker is asking... View More

Maurice Mandel II
Maurice Mandel II
answered on May 17, 2025

It is a common error for employers to believe they can mail a final payment, NOT SO FAST! If you hire an employee who YOU terminate- for cause or for the end of the temporary work, you have to pay them right then. In person. Or before. (no one pays before because few workers would return for the... View More

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3 Answers | Asked in Employment Law, Civil Litigation, Contracts and Personal Injury for California on
Q: Can a California employee be personally sued for a guest's injury?

I am an employee at a waxing establishment in California. A guest experienced a skin tear during a procedure I performed while following company procedures, and she is now suing both the company and me. Although I am a paid employee, I have received a contract from the company's lawyer to sign... View More

Brad S Kane
Brad S Kane
answered on May 10, 2025

Anyone can be sued for anything.

You are sued for activities performed within the course and scope of your job and the injury was not intentional, the employer has a legal obligation to indemnify you for reasonable and necessary expenses, including the costs of defending the claim or paying...
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3 Answers | Asked in Employment Law, Civil Litigation, Contracts and Personal Injury for California on
Q: Can a California employee be personally sued for a guest's injury?

I am an employee at a waxing establishment in California. A guest experienced a skin tear during a procedure I performed while following company procedures, and she is now suing both the company and me. Although I am a paid employee, I have received a contract from the company's lawyer to sign... View More

William John Light
William John Light
answered on May 10, 2025

Yes it’s legal. Your employer has a duty to indemnify you for expenses you incur in the course and scope of employment. If you refuse the employer’s offer of a defense, it can argue that any expenses you incur were voluntary and it doesn’t have an obligation to indemnify you.

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2 Answers | Asked in Contracts, Employment Law and Intellectual Property for California on
Q: Is my former employer legally allowed to request access to my personal USB device after leaving the company?

I recently left my job at a tech company in California, where I signed an NDA as part of my employment agreement. HR and IT have requested that I submit my personal USB device for inspection and wiping, claiming I downloaded some work-related files before my departure. I've deleted most of the... View More

Michael R Trust
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answered on May 9, 2025

Hello. You've said here that there were work files on the device, so the company has a legitimate concern about what else you might have. I'd ask them if they'd take a Declaration from you that you have deleted everything you had (assuming that's true). You no longer work there,... View More

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