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Legal advice?

Started by woodhick, May 09, 2007, 09:24:29 PM

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woodhick

I have a bandmill leased to a local timber framer.  Mill is kept in his building.  His men run mill and keep track of time which I am paid for at an agreed rate.  Problem is since the first of this year it's been a little harder to get paid.  Have had to ask persistently for money and he has came through. I know his employees checks have not cleared a couple of times.   Obvious he is in some financial trouble. Question is if something happens such as court locks building due to lawsuit, bankruptcy,etc, where does my mill stand.  It is not a possesion of his business.  Would I be allowed to remove it?  I will probably just pull it and sell it before anything happens but checking my options.  It did pay very well last year, so I don't want to pull out of a good thing if it turns out to be a temporay setback for him.   Would just ask owner but I beleive he's in denial about his current financial condition.   Don't want to loose mill because of his misgivings.  Thanks for any help.
Woodmizer LT40 Super 42hp Kubota, and more heavy iron woodworking equipment than I have room for.

Dave Shepard

I don't know about your situation, but I have heard of this happening. I'd hate to have to fight this battle, should it ever come up. If the banks are tryig to retrieve their capitol, they will try and take anything they can.


Dave
Wood-Mizer LT40HDD51-WR Wireless, Kubota L48, Honda Rincon 650, TJ208 G-S, and a 60"LogRite!

Raider Bill

Seems you are in a bad spot. If someone shuts his doors with your mill inside you will be in a up hill battle to regain possession.

But if you pull it and like you say this guy is just having a bad spell then you risk the rental and relantionship.
Good luck
The First 70 years of childhood is always the hardest.

thurlow

Local Allis-Chalmers dealer...........back when it was A-C.............lost his franchise, apparently due to some shenanigans he was pulling with his floor plans.  A fellow from A-C showed up one day with a court order and a fleet of flat bed trucks.  They hauled off everything; his used equipment, short-line equipment, parts, etc.  Don't recall about customer's tractors that were being worked on in the shop.  Probably about one third of the stuff actually came from A-C.  He eventually got "his" stuff back, but it took about 2 years and a lawyer to do it.  
Here's to us and those like us; DanG few of us left!

pappy

Quote from: woodhick on May 09, 2007, 09:24:29 PM
  Mill is kept in his building. Possession 9/10ths of the law

   Obvious he is in some financial trouble. BIG RED FLAG
   

IMHO git it out'ta there ASAP !!! if you don't want any more headaches... There will be others that will need your services,,,  ya can't do business with out it .....
"And if we live, we shall go again, for the enchantment which falls upon those who have gone into the woodland is never broken."

"Down the Allagash."  by; Henry Withee

Dave Shepard

The flip side of pulling your mill. How bad off is this guy? If he's just stumbling, and you pull your mill out, he may fall the rest of the way down. I think you need to get the real story from the horses mouth. While it isn't your responsibility to watch over this guy, he may just need some time. There are few things worse than a kick in the stomach when you are already down, I know this first hand.


Dave
Wood-Mizer LT40HDD51-WR Wireless, Kubota L48, Honda Rincon 650, TJ208 G-S, and a 60"LogRite!

Ianab

The mill remains your property... but...
It can get messy if the company is put into recievership or similar, the locks get changed and your mill is stuck inside or 'accidentally' hauled off with other re-possesed equipment.
It might take some time and hassle to get it back again.

Make sure you have all the documentation for the mill, copy of the rental agreement etc. If something does happen you will have to prove it's your mill to get it back again.

It's a bit of a risk I guess, but if he's in a temporary tight spot, you pulling the mill out might be the last straw and end what could still be a profitable venture for you. I suggest you talk to him, he may not tell you much, but maybe you can judge how straight he is being with you.

Cheers

Ian
Weekend warrior, Peterson JP test pilot, Dolmar 7900 and Stihl MS310 saws and  the usual collection of power tools :)

olyman

as some said--maybe can ride it out--but i can almost guarantee you---if hes shut down--and your mill is there---you will be in a extreme uphill battle to get it back--cause its on his farm--and possesion is 9/10ths of the law--been there---could get ugly----

logwalker

Woodhick, what you need to do is check with the state you live in and look into UCC filings. A UCC is a legal document that states to the rest of the business world that the mill is your property and the timber framer can not encumber it in anyway that would jeopardize your ownership. This puts you in First Position and will protect you in the event of an asset seizure. A filing is inexpensive and easy. It is in a searchable database that any finacial institution will check before loaning money against it. So I would be searching tonight to make sure that he has not already encumbered it. If he has then it would come out of there tomorrow. Keep us posted on this one. From time to time we all could benefit from your experience. Joe
Let's all be careful out there tomorrow. Lt40hd, 22' Kenworth Flatbed rollback dump, MM45B Mitsubishi trackhoe, Clark5000lb Forklift, Kubota L2850 tractor

Dan_Shade

call a bankruptcy lawyer that knows your state laws.  may cost you a few bucks, but you'll know what you need to do to protect your asset.
Woodmizer LT40HDG25 / Stihl 066 alaskan
lots of dull bands and chains

There's a fine line between turning firewood into beautiful things and beautiful things into firewood.

woodhick

I appreciate all of your replies.   I do feel some responsibility to the workers there.  I feel pulling the  mill will hurt the business right away and they may loose their jobs.  However I need to protect my property first.   I am not too concerned about the owner of the business due to his attitude on this when I have tried to inquire about it.  He speaks with the forked tongue.  That's all I will say about him.  I do hate to see people that are working for living get shafted and that's why I have'nt pulled mill yet.  This guy has been in this business for 20 or more years so I don't know if it's just a hard time or close to the end.    I am pretty sure I am going to sell mill and am working up adds now.  I guess the new owner could leave it there but I would disclose my fears and knowledge about situation to him.   I should add that I know the current owners bills are being carried by another company that is tied in with him on  a large job that is going through shop now.  I am afraid after this job is done that contractor will stop funding and the shop will fall.  I will keep everyone posted and mill may show up in classified shortly. ;)
Woodmizer LT40 Super 42hp Kubota, and more heavy iron woodworking equipment than I have room for.

sawmilllawyer

Don't know West Virginia law so can't give legal advice. But a UCC 1 filing only costs $10.00 in Oklahoma and protects you as the owner/lender from claims of other parties like logwalker said. But like some of the others said once the mill has been locked down, getting it back may turn into a bit of a challenge or your worst nightmare.
What kinda contract you got with him? Is it written or just oral? Is the mill clearly identified by S/N and property of yours or your company? Also, if he has paid you each month or as agreed, do you rightly have cause to pull the mill for breach of contact? Maybe not. What's the contract say about failure to timely pay? Have you filed a UCC 1? Has he encumbered the mill in any way, say like signing an all encompasing security instrument.
I'd talk to the man straight up and at a time and place that was appropriate. Probably, meet up with him away from his business/employees and get the low down on his financial situation. Also, if he's a friendly, develope an exit plan where by you could retrieve your mill before it gets locked down, if that's where this thing is headed.
Finally, if you are not happy with what's going on consult local legal counsel who deals with these type of situations and soon, before everything goes South.  Kinda walking the line between a "good deal" and getting "burned" looks like you got a hard call to make. Just my .02. Hope it all shakes out alright.
Stihl MS-361, MS-460 mag, Poulan 2150, 2375 Wildthing.

woodhick

Sawmilllayer,  that's part of the problem.  Mill is shopbuilt by me, no serial number.  No written contract just verbal.   I have been with this guy for two years and not a problem till just the last couple of months.   
Woodmizer LT40 Super 42hp Kubota, and more heavy iron woodworking equipment than I have room for.

sawmilllawyer

Oh, I think I understand. Just a business question. If you are going to sell the mill anyway what about selling to the new owners this guy is working with? Cash out and get out? Just a thought.
Stihl MS-361, MS-460 mag, Poulan 2150, 2375 Wildthing.

woodhick

I priced it to them but have not heard anything from them yet.  I think he just wants to get through this job and run!
Woodmizer LT40 Super 42hp Kubota, and more heavy iron woodworking equipment than I have room for.

scsmith42

You may want to consider speaking directly with the customer that is "footing the bill" so to speak, to see if they will put pressure upon the company to bring  you current.

Then, pull your mill out ASAP once that the "big job in process" is complete. 
Peterson 10" WPF with 65' of track
Smith - Gallagher dedicated slabber
Tom's 3638D Baker band mill
and a mix of log handling heavy equipment.

Haytrader

If you advertize it and a prospective buyer wants to see it, what will you do?
Haytrader

tdelorme

If his payroll checks are no good chances are he is not paying his payroll taxes.  It won't be long before the government boys come in and lock the doors and you will spend a ton of time and dollars trying to get the mill back.  If you are really concerned, go get your mill today.

Fla._Deadheader


Been through this kinda thing, 1 time.

  My experience, if the guy is bouncin checks to the workers, he is padding HIS account or is hanging on by the fingernails until the job is done. He doesn't really sincerely care about them.  >:(

  Being as how my son was a KEY player cutting parts, and I was the only one building certain size-type boats, we confronted the boss and said, keep your checks. I don't play that game. Every payday, Ed and I get cash, or, we walk. We have other places that would take us tomorrow.

  From then on, WE were paid cash, while the rest screamed and threatened. 2 months later, the shop closed and moved North.

  ONE discussion with this guy, face to face, will tell you what to do.

  You will NOT be the bad guy.
All truth passes through three stages:
   First, it is ridiculed;
   Second, it is violently opposed; and
   Third, it is accepted as self-evident.

-- Arthur Schopenhauer (1788-1860)

jpgreen

In my opinion, you need to end this and get your mill out of there pronto. The fact that you built this mill, and are letting this company use it without insurance sets you up to loose every penny and asset you own if one of those guys were to get hurt.

THat alone would make me run scared..  :o
-95 Wood-Mizer LT40HD 27 Hp Kawasaki water cooled engine-

flip

Give him 30day notice you are selling the mill and see how serious he gets.  If you don't have a written contract you better come up with one NOW!  Tell him you are going to sell it and no longer want the burden of having it tied up.  If he is serious about his business there is no reason he can't buy or lease one from WM TK NW BP or someone.  If you continue to let him use it put in the contract  that the lease is weekly based.  If he is late or fails to make a paymet you have the right to reposses at any time. 
I have seen it many times in my business a guy leases a new big truck and trailer and files bankruptcy 2 years later.  When he goes to court he tells the judge if they take his truck he can't earn money to pay us and the creditors back, judge lets him keep the truck and we get stiffed.
Timberking B-20, Hydraulics make me board quick

sawmilllawyer

Woodhick, I thinking some pretty good responses from the others. If me, probably put this guy on a short leash, so's I could yank that mill outta there. Probably, would yank that mill outta there, think about it. Just keeping an eye on this guy and worying over the fate of the mill would in itself be quite the hassle. If you pull it and store it down side is you have your mill and the oppportunity to lease or sell it to someone else.
Stihl MS-361, MS-460 mag, Poulan 2150, 2375 Wildthing.

fstedy

PROTECT YOURSELF!!!

File that UCC filing ASAP that as the others have said will give you first standing on the mill. Talk to your local sheriff most likely he would be the one to secure the property in the event of a default. He may be able to give you some insight into how you should proceed.

Your customer has already stiffed the employees and is stringing you along for his convience to finish this job. If he were upfront he would have been man enough to explain to you why he late paying since your mill is KEY to his operation. Without thye mill all production stops. Another thought with this being homemake mill constructed by you if an accident should happen you're in for some major money problem even if its only defending yourself. Good Luck!! 
Timberking B-20   Retired and enjoying every minute of it.
Former occupations Electrical Lineman, Airline Pilot, Owner operator of Machine Shop, Slot Machine Technician and Sawmill Operator.
I know its a long story!!!

solidwoods

Get the mill.
Set it up on your property.
Farmer can bring the logs to you.
Hire the labors to mill.
jim
Ret. US Army
Kasco II B Band mill
Woodworking since 83
I mill & kiln dry lumber, build custom furniture, artworks, flooring, etc.
If you mill, you'll be interested in some of my work in one way or another.
We ship from our showroom.
N. Central TN.

woodhick

Update:   told business owner I was going to advertise mill and offered him first refusal.  he didn't bite.  Two weeks later things were getting tight at his place and his foreman told me I should make a move.  I had one buyer interested in looking at mill.  I went this past Monday to remove mill from building and the interested buyer met me there to look at it.  Long story short he bought it and it's gone.  Thanks for everyones help.
Woodmizer LT40 Super 42hp Kubota, and more heavy iron woodworking equipment than I have room for.

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