A scandal centred on a famous sports trainer has been in the public domain lately. He has, according to women, defrauded a number of them and extorted significant sums of money, of varying amounts, under the guise of romantic promises and relationships.
The latter story is illustrative of the many variations of The Tinder Swindler. However, in the "Lithuanian" case, the situation is more ingenious - the protagonist not only took advantage of a romantic relationship to swindle the money, but also promised to use it for a specific purpose - to set up a joint business with the victims.
The story ended with no love, no money and no promised business, and the victims were left with financial losses and non-material damage to their mental and emotional health. According to publicly available information, the law enforcement authorities refused to open a pre-trial investigation.
The situation is aggravated by the fact that the money was extorted not only by promising to set up a business together, but also by the fact that such plans were laced with promises of love, which objectively makes it more difficult for the victims to weigh up the situation, the risks and the dangers logically.
So what legal options are there to protect your investment in a jointly created business?", says Karolina Laura Briliūtė, Associate at AVOCAD .
First of all, the decision of the law enforcement authorities to refuse to open a pre-trial investigation is not surprising in this case. It is likely and most similar to the fact that a pre-trial investigation for fraud was requested. According to the Criminal Code, fraud is the fraudulent acquisition, evasion or avoidance of an asset or property right, or the avoidance or cancellation of a financial obligation, for the benefit of oneself or others. Fraud is used with the intention of deceiving the owner, manager or person in whose possession the property is located, who, having been deceived, voluntarily transfers the property or property right to the perpetrator, believing that the latter has the right to receive it, or cancels the perpetrator's property obligation.
Although the situation is superficially similar to fraud, it should be borne in mind that criminal law and criminal sanctions are only used as an ultima ratio (last resort), when other legal means of restoring the right violated have been exhausted. Moreover, in the present case, the victims themselves freely contributed money to the perpetrator, incurred expenses for the purchase of various items, and rented premises for the filming and production of the content, and these circumstances should therefore be viewed unfavourably in the context of the decision on the application of criminal measures.
Moreover, circumstances such as shared holidays, travel and spending money together, in the eyes of the law enforcement authorities, are reasonably more likely to suggest a purely romantic relationship, where one of the persons invests more money in the relationship than the other. However, in such a case, there is naturally no legal basis for interfering in the relationship between the two individuals.
Firstly, if the other person proposes to start a business together and asks for funding to start the business (for example, as in this case, to buy certain clothes, items, film equipment, rent an apartment), the relationship is similar to a legal relationship of joint activity.
A joint venture/partnership agreement commits two or more persons (partners) to act jointly, by pooling their property, labour or knowledge, for a specific purpose or activity that is not contrary to the law. The legal form of a joint venture/partnership agreement can take a wide variety of civil relationships - any commitment between several persons, not contrary to law, to engage in a common activity or to pursue a common purpose by cooperating in a joint activity or to pursue a common purpose by cooperating in the use of property or intangible assets. The essential features of a joint venture agreement are: the co-operation of the property, intellectual or labour resources (contributions) of several persons; an obligation to use the co-operated resources to act jointly; and a common purpose and interest of the participants in the development of an activity or the pursuit of an objective.
It should be borne in mind here that a joint venture/partnership agreement must be in writing and, in cases provided for by law, in notarial form. Failure to comply with the form of the agreement renders the agreement null and void. Therefore, in cases where a romantic or other entity proposes to invest finances in a joint venture, it is advisable to initiate the signing of such an agreement, thus protecting oneself against potentially fraudulent actions.
In practice, there have been cases where a court has been asked to declare that a joint venture relationship existed between the parties and that a joint venture agreement had been concluded (certain documents existed, but were not formalised as a single contract). The courts refused to uphold such a claim without finding that there was a unanimous and purposeful intention of the parties to establish and develop a business relationship. Such interpretations only confirm that, even in a romantic relationship, the risks should be weighed and the contract should be drafted in a way that best reflects the intention of the parties in order to best protect the investment.
Finally, if the worst-case scenario were to be the case, where money was invested, but the love ended and the joint venture did not materialise, it is considered that the injured party would be able to rely on the defence of unjust enrichment.
According to the Civil Code, a person who, without legal justification, has acquired by his own acts or otherwise, intentionally or negligently, what he could not and should not have received, is obliged to return it to the person at whose expense it was acquired, except for the exceptions set out in this Code. A person who has been unjustly enriched at the expense of another person without legal justification shall be liable to compensate the latter for damages to the extent of the unjust enrichment.
These rules give effect to one of the fundamental principles of civil law - that no one can be enriched at the expense of another without a basis in law or contract. At the same time, it implies the right to recover from another person what he has unjustly saved or otherwise benefited at the expense of the creditor. In order for the obligation to repay to arise, the person must first have acquired the property without legal justification, i.e. the receipt of the object or money cannot be justified either by law or by a transaction.
In summary, for this remedy to be effective, the person must be prepared to prove that he or she has incurred the expenditure (buying things, renting an apartment, renting a car, etc.), not for romantic purposes, but as a result of material misrepresentation and deception, in the hope that he or she will derive a benefit from the transfer of the money, in this case, the proceeds of the joint business. It is well known that the law does not interfere in the personal (romantic) relationships of individuals, so the person who loses the funds must also be prepared for the risk that the courts may decide that the expenses were incurred in the interests of the couple and not award such losses.