Lien on property/piercing the corporate veil

I own a home in florida and hired a company to mange it. The management company did not pay/deposit 4 months of rent payment to my account. The owner is trying to hide behind the corporation saying that the business is in debt to vendors. He claims that the money is frozen and he cannot pay out anything.. I threatened to sue and he told me " Good Luck in getting your Money" . I am going to pursue him in small claims court since it is just under $5000. I understand that even with a judgement I may not get paid.. (He is listed as the ceo of the management company with only one other person named as a VP).
I believe that his debt is not my problem.. His vendors should be paid from the fee that I and other owners pay him. The rental payment belong to the owners.

1. I want to know if anyone knows how I can go after his personal property to make it harder for him.
2. I would also know how to find out who his other clients are. I would like to find out how many of them have been burned. I am hoping to get as many of us as possible together to go after him.

Any other advice on how to go after him legally would be helpful

Edited: 06/26/2010 at 05:00AM

Frank Adams

· Loveland, CO

1170 posts
1209 Influence
4 Awards

Icon_minipost Apr 07 '08, 06:19 PM

Well I'm not going to be any help on your direct question. Situations like you're in I usually let my " cousin Vinny" handle for me.

But...The following isn't going to help you, but rather serve as a warning, or trip wire for the others on here. Spoiler, this may hurt a bit. YOU brought this on yourself;

The management company did not pay/deposit 4 months of rent payment to my account

Starting around the 30th of the month I start monitoring my account balance (it's online now, welcome to the 21st century), any deposit that's not posted by the third of the month I'm on the phone looking for it. In the case of tenants I either get a satisfactory answer or the 3 day notice gets nailed and mailed THAT DAY.

In the case of a management company not depositing I'd check with the tenant and ask if he'd paid. If he said yes I'd be back on the phone to the management company for an explanation. With a wrong answer they would be terminated THAT DAY.

Sorry for your loss. Another reason NOT to hire management company, leading back to not owning out of town RE.

all cash

Edited: 06/26/2010 at 05:00AM

Ryan Webber

Wholesaler · Amarillo, Texas

1887 posts
5713 Influence
7 Awards

Icon_minipost Apr 07 '08, 08:54 PM

If he is a licensed real estate agent I would look into the state's real estate recovery fund. Its a fund set up to compensate consumers when agents screw them. I think you have to start with a complaint with the state's real estate licensing commission.

If he's not an agent, he may have been breaking the law by practicing real estate agency without a license. I know at least in Texas that to do property management for someone else you have to have a real estate license.

Edited: 06/26/2010 at 05:00AM

TM Jospeh

Homeowner · Hollywood, FL

5 posts
1 Award

Icon_minipost Apr 08 '08, 09:40 AM

Ryan thank you for your response and advice. I filed a complaint with the Fl dept of Business Professional Regulation. They have acknowledged that they received the complaint. They have advised me that it will be 3 wks for them to determine what action needs to be taken. His real estate license is now inactive, since Dec 2007. Just about the time the problem started. My tenants paid their rent 3 months in advance and the 4th is one months deposit that he had " in escrow" for me.

Edited: 06/26/2010 at 05:01AM

TM Jospeh

Homeowner · Hollywood, FL

5 posts
1 Award

Icon_minipost Apr 08 '08, 09:52 AM

To all cash.. you don't know all the details so please don't judge. I was laid off and offered a job in another state with the same company at a higher salary. I was given 14 days to move. With the real estate market the way it is in Florida selling in 14 days was not going to happen. I could not afford to leave the house empty. I did the best thing I could with the time I had. I tried to do the proper research. Check his license, spoke to 3 other owners, check the bbb for complaints, check with Prudential to make sure he was in good standing. He did manage the property well for one year. The tenants were advised not to pay him once I discovered the payment was 10 dyas late. My tenants are good people who paid on time. Unfortunately for me they decided to pay their rent for 3 months in advance because they were going to Europe for 2 months.

YOU could do the right thing in your business dealings and still get screwed even dealing in ALL CASH.

Edited: 06/26/2010 at 05:01AM

Steve Steadele

5 posts
4 Influence
1 Award

Icon_minipost Apr 09 '08, 12:33 AM

The corporate veil may or may not be all that difficult to pierce - depending on the owner. I'm guessing this is probably an S-Corp. The first thing I'd do is look at ALL of the previous paperwork from the management company and make sure that they represented themselves as a corporation. Look for evidence of such on the management agreement, checks, business cards, emails, etc. I'm guessing that if you did enough research you'd find that the management company would have a hard time hiding behind the corporate veil because they were too busy trying to keep their head above water to focus time or effort protecting the veil. Once you pierce the veil it'll be a lot easier to go after his/her personal property.

Although the state might be able to help you to some degree, my guess is that the management company won't be too worried about that. If they lose their license there are a lot of things they can do to start up again. As far as other clients are concerned - it might be a little late. If the company has a web site you could look at that and see if there are properties listed. You could also look at old newspaper advertising - maybe they have something there. Finally, talk to real estate agents or management companies in the area - they might know somebody whose property was being managed by the same company.

Start with that. PM me if you have questions.

Edited: 06/26/2010 at 05:01AM

TM Jospeh

Homeowner · Hollywood, FL

5 posts
1 Award

Icon_minipost Apr 09 '08, 09:00 AM

ssteadele, I will follow your sage advice. Thanks!

Edited: 06/26/2010 at 05:01AM

Philip Rowe

Residential Real Estate Agent · Hollywood, Florida

40 posts
41 Influence
2 Awards

Icon_minipost Apr 11 '08, 08:42 AM

What is the name of the Company/Owner? I am in Hollywood, i would at least like to know who to look out for. That is an absolutely terrible situation. Sorry to hear about your problems. Business down here is soo shady its hard to trust ANYONE.

Edited: 06/26/2010 at 05:02AM

TM Jospeh

Homeowner · Hollywood, FL

5 posts
1 Award

Icon_minipost Apr 11 '08, 10:05 AM

ManageRent. Miramar, Florida

Edited: 06/26/2010 at 05:02AM

Alexandra Schnee

Real Estate Investor

1 post

Icon_minipost May 05 '08, 07:00 AM

Don't feel so bad I know of at least one other couple including myself and my husband that has gotten burned by Shawn McCulloch and ManageRent. He stole about 2K from us(one months worth of rent plus security deposit). He stole about 6K from another couple. He can run but he can't hide. We filed a complaint with the Florida Department of Business Profession Regulation (Division of Real Estate), so did the other couple. The number is 407-481-5662. YOU NEED TO FILE A COMPLAINT WITH THE BOARD ASAP AND THEN GO TO SMALL CLAIMS. HE CANNOT HIDE BEHIND THE CORPORATE VEIL. By the way, he's probably fled to New York or he will be headed there after we get done with him.
OUR GOAL IS FOR HIM TO NEVER DO ANY TYPE OF REAL ESTATE AS A REALTOR OR MANAGEMENT COMPANY AGAIN. I'M TIRED OF CROOKS GETTING AWAY WITH EVERYTHING IN THIS BUSINESS. ENOUGH IS ENOUGH!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!1

Edited: 06/26/2010 at 05:09AM