Can Wedding Venue Be Criminally Charged for Keeping Deposit Money?

Question (from Anonymous in TX):

How do my husband and I pursue a business we signed a contract with to hold our wedding reception?: My husband & I hired a company back in June to host our wedding reception at their venue on Nov. 9th. In Oct., we made the final payment totalling $4,350 for the venue & services. On Nov. 1st, we received a call from one of the owners stating their company has gone out of business; they’re unable to maintain the business due to other clients not paying & passing off bad checks. She then stated they’re filing bankrupt because the monies we paid wasn’t allocated to any hired vendors due to their financial struggle. Basically, she didn’t have any of our money to return or wouldn’t provide contacts for the hired vendors. After researching, we found there are 4-5 other couples involved also, no monies returned. There’s also a large sum of money owed to their former landlord – we’ve been scammed.

Response (from Attorney Rob):

I’m so sorry to hear that this has happened to you. I recall reading about this when it happened.

The police are going to refer you to a Civil Litigation Attorney for this, because in reality, even though what these guys did, at worst, is straight up theft, 99.9% of the time, this will not be a criminal matter. When money exchanges hands, and there is a contract involved, the CIVIL justice system is the only avenue that the parties have to acquire a remedy. Still, I’m sure it would feel good to put scam artists in jail (if that is in fact what happened).

So, either (a) these guys took your money with the intent of shutting their doors and leaving or (b) they fell on really, really hard times. Either way, it will be difficult to enforce a judgment against them, even though it may be fairly ‘simple’ to get a judgment against them. We’re talking two different things.

Even after you take these jokers to court (if you can find them to serve them the lawsuit papers), and are awarded a judgment based on a breach of contract (or fraud), at the end of the day, you will only have a piece of paper that says “jokers owe the newlyweds $4350.00” You then have to ‘enforce’ the judgment, meaning garnish wages or levy property. When someone doesn’t have any money, you won’t be able to garnish or levy on anything. We call this being ‘judgment proof’.

You did the right thing by reporting this to the news, social media, and other outlets (BBB, etc). That way, this lessens the likelihood that they can do this to someone else. Unfortunately, although you have been done a very, very serious wrong, alerting the world on what happened is going to be about the only thing you will really be able to do. The time and energy chasing these guys down in the civil process is not worth the end result.

Again, I am very sorry to hear about this. I wish you the best of luck in your new marriage.

Moral of the Story: Even in the event that a wedding business professional falls on hard times, it’s important to be up front with clients from the get-go. Hiding bad news will only compound future problems, and cause what would normally be a simple breach of contract, into potential claims for fraud, or in the worst scenario, criminal theft.