Possible breach of contract? Need advice!!

[Fatwhale]

Sorry guys, this is a long story so I'll try to speed through the best I can. If you guys have any questions, feel free to state it here and I'll be happy to clarify.

State: California

The Agreement/Contract:

My parents recently sold a part of their business to a guy named Charlie. We have a written contract dated/effective on May 1, 2008.

Purchase price of the business was roughly about 500K USD (200K deposit with the rest paid monthly for two years at 6% interest). Upon non-payment for 3 months, we will be able to take the business back without warning.

Furthermore, Charlie agreed to pay for the business AND the inventory at hand (worth about another 500k at the time of the contract). The sum for the inventory was to be paid in full within 60 days of the contract.

How Charlie breached the contract:

1. It has been almost 20 MONTHS since the closing of the contract and Charlie has yet to pay the inventory.

2. This is also his 2nd consecutive month is failing to pay the agreed financed amount for the business.

What actions we have taken:

- Opened up a law suit against Charlie. We intend to make Charlie pay for the full amount owed to us or retake the business.

- The amount of money he owes us has impeded our progress in our other business ventures as we simply have all these funds "tied up" in Charlie's hands.

My questions:

1. Charlie is still hiring lawyers to fight this case and that confuses me because I feel like due to the MAJOR breaches of contract present, he will lose no matter what. So why is he still fighting the case? Is there any way that he can still win this case?

2. Would it be possible for someone like Charlie to say... "strike a deal" in the court where he would be allowed to pay the amount owed in increments? I am strongly against allowing Charlie to settle this in payments as I don't think he would do it, which would only result in another law suit and MORE expenses. (which is the reason why I want him to pay the entire amount OR give us back the business)

Please advise.

P.S. Sorry if this is a LONGGG first post. This is an emergency and I don't know where else to turn. Any advice would help. Thanks!

 

[Fatwhale]

oops.. mods can you please move this to the business contracts section of this forum. Just realized I posted it in the wrong section

 

[tranquility]

There is an old joke there is never enough work for a lawyer in a small town. However, in that same small town, there is always more then enough work for two.

There is always an argument. I can't guess as to their position, but guarantee you need an attorney. It is unlikely the court will "strike a deal", but, you might.

 

[latigo]

You are talking about a “supposedly” million dollar transaction in serious jeopardy and you haven’t the sense to know “who to turn to”?!

Get serious! It’s been sometime since I last fell off of a turnip truck.

 

[latigo]

What’s up, Fatwhale.

I write that your lengthy scenario smells fishy and no rejoinder forthcoming! Perhaps you are preparing it.

But if you are in the process of countering my remarks, please add your explanation as to why a business man with the moxie to accumulate a million dollar enterprise would be so foolish as to turn over to a buyer $500,000 of "readily-convertible-to-cash" business inventory on a mere promise to pay the half million sometime in the future?

If I were to put a client in such a precarious position and the buyer defaulted as you claim here, I could reasonably expect the client to have me in court for the unpaid balance with not a prayer of a defense.