Legal Question in Real Estate Law in California

Re: Release of Business Contract

Anyone can sue. That doesn't mean they will prevail. You may have a waiver on the part of the estate to assert that you didn't perform by close of escrow. In addition, the attorney told you they wanted to renegotiate the terms, which would also be a repudiation of the contract and waiver of their right to enforce the contract. Feel free to contact me to discuss further.

Re: Release of Business Contract

I agree with Ms. Barron, but would add that I doubt that the heirs would be able to prevail on a lawsuit claiming your friend damaged them by leaving the business. Involuntary servitude was abolished long ago and as a general rule, employees in California are considered to be "at will," meaning they can quit or be fired at any time and for any reason. Unless your friend had an employment agreement for a specified period of time, I doubt a court would grant the heirs a judgment for business losses simply because your friend left the business.

What may be more problematic is that, depending upon the terms of the agreements your friend and the owner of the business signed for the purchase of the business, your friend may get sued for breaching the agreement to buy the business.

I would strongly suggest that you tell your friend to take all of the documents relating to the purchase of the business to an attorney in his or her area and have them reviewed.

Re: Release of Business Contract

I think the presumption in the last sentence of your question "since contract was void" is a conclusion that cannot be reached so readily. I don't see the contract as "void" based on these facts. The contract may not be enforceable, or it may be enforceable with court-supplied terms based upon interpreting the original intent of the parties, but in any case, there was at one time a valid contract and as a result the parties and their successors have rights and duties that can be enforced through claims for damages and possibly specific performance.

There is a big legal difference between a contract which is "void" and one which is "voidable," or no longer enforceable, or breached so that the other party's performance is excused. All these situations have different consequences.

I doubt that a star salesperson's leaving the business would be of legal significance in the sale-of-business dispute (quitting is a right, as has been pointed out), but if that person were under contract with the employer, quitting could be a ground for a claim for damages for breach of the employment contract.

I'm unsure where fault lies in the entanglement you describe, and the kids would probably have a different version of the facts, but my daughter lives in Chico and I'm a frequent visitor and would be willing to sit down in person with your friend and provide a free consultation where we could go over the details of what happened.