I started an LLC with my father and sold in 07 to him and another member. What liability do I have if it goes under now.
Get Legal Help Today
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
I started an LLC with my father and sold in 07 to him and another member. What liability do I have if it goes under now.
I had used the equity in my home as collateral for a small business loan and signed personal guarantee for a lease. The business has been operating under the other members for 2 additional years after I did a Bill of Sale stating that I sold my assets and liabilities to the LLC and that the LLC was to notify all parties of the change of ownership. I believe that the LLC may go under soon and want to be prepared for any problems that may crop up. The Bill of Sale was done without any Lawyers involved but was signed by all parties involved with the sale
Asked on May 18, 2009 under Business Law, Virginia
Answers:
J.M.A., Member in Good Standing of the Connecticut Bar / FreeAdvice Contributing Attorney
Answered 15 years ago | Contributor
I would have to have more information to provide you with a definitive response. Howevrer, based on what you say here goes: As far as your liability on the lease, your personal guaratee will keep you on the hook unless you were released when you sold the business. I would have gotten the new owners to replace you on the lease - assuming you could get the other party to the lease to agree. If the biz goes under you could be liable on the lease as a result of the personal guarantee. As far as the debts that the company incurred since the sale, you should not be liable for those. I would seek a lawyer to review the bill of sale and lease as i would ned to see them to determine the extent of your exposure.
IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.