Legal Question in Business Law in Washington

Am I liable for debts?

I bought a LLC recently. Prior to the LLC being formed, the owner operated under his own name and signed vendor contracts in his own name, DBA the business name. The contracts were never redone in the LLC name.

I have not paid the vendors on these contracts. Can I get around the bills by the fact that the vendors never had a contract with the LLC, only the individual prior to the LLC being formed?


Asked on 2/17/09, 6:50 pm

1 Answer from Attorneys
James Vasquez In Pacta, PLLC

Re: Am I liable for debts?

Whether or not you are liable for the contracts depends on the language of the purchase/sale agreement that you signed for the LLC as you may have purchased the LLC subject to pre-existing agreements with 3rd party vendors, so check that first. There is an argument to be made that since the contracts were never transfered to the LLC, the LLC can reject them, and thus the LLC is not liable. However, if you have already received a benefit from the vendors, you could still be liable for the services or goods received even if there isn't an enforceable contract.

If you need further assistance with your LLC, contracts, or other business related issues. I offer reasonable rates so feel free to contact me.

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Answered on 2/18/09, 1:09 pm


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