If a business closes unexpectedly and owes me money, what can I do to get my money back?

UPDATED: Dec 5, 2011

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If a business closes unexpectedly and owes me money, what can I do to get my money back?

My personal training gym recently closed without giving any prior notice to their employees (the trainers) or their clients. I’m owed $800 from which I have to yet to receive any details of (i.e. when I’m supposed to receive the money, etc.). The closing was very sudden and it has been very difficult getting a straight answer from the owner of the gym.

Asked on December 5, 2011 under General Practice, New York


L.P., Member, Pennsylvania and New Jersey Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

Thank you for submitting your question regarding money owed to you as a former trainer of a gym the recently and suddenly closed.  Your situation and legal issue is based on the legal theory of contracts.  You had a contract with your employer that would provide a service and your employee would compensate you in return for your service as a trainer for their gym. 

In a normal contract dispute situation, when an amount $5,000.00 or lower was in dispute, you could take the issue to small claims court in an attempt to collect the debt.  At the small claims court you would bring any evidence you have to support that you are owed $800.00.  This may be clear in a prior paycheck that they gave you or some other legal writing that you have in your possession.  Additionally there may be other employees that could be your witnesses to this money owed.

However, when a business closes suddenly with no notice to the employees and it is difficult to contact the former business owners, there may be a bankruptcy opening soon.  If so, you need to be added as one of the creditors for the bankruptcy.  If you were to sue in small claims court and they do not have the money, then you will have a judgment against them that you cannot collect on.  However you can use that judgment to be considered as a creditor to the bankruptcy.

It may be helpful to have an attorney send the business a letter about the monies owed to you.  Also, an attorney may provide some guidance of how to further pursue this matter in court.


IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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