The Second Appellate District affirmed a judgment. The court held that where employers entered into agreements with a payroll processing company to satisfy their payroll obligations and transferred an unrestricted interest in deposited funds to the company in order to permit it to do so, their failure to require that the funds be held in trust defeated their claims against a creditor who later seized all funds in the company’s accounts.
Lonely Maiden Productions, LLC and other film producers contracted with Axium International, Inc. to provide payroll processing, staffing and other services with respect to specified film projects. The parties signed written service agreements which provided that Axium would serve as the joint employer of the cast and crew for each film; the film clients would provide all relevant payroll details to Axium; Axium would calculate, inter alia, wages and withholdings; Axium would invoice the film clients for the amounts due; and once the film clients transferred the invoiced amounts, Axium would issue payroll checks to cast and crew and pay withholdings to the appropriate entities.
