Legal Question in Business Law in California

Does the CA agency have the right to transfer penalties from the terminated LLC to another entity (S-Corp)?

I am a general contractor, with my partner we have an S-corp registered in CA. My partner previously had a painting LLC with his friend. They opened LLC in 2016 and did a couple of public projects. In May 2019, they decided to terminate LLC. After LLC was terminated, the State Agency sends a "Penalty assessment" to the LLC and to my corp., because my partner was as a member of LLC (I'm not). Now they ask to pay fines for LLC where I was not a member. I want to find out how lawful is?

Asked on 6/26/20, 9:03 pm

1 Answer from Attorneys

Robert Kane Law Offices of Robert D. Kane, Jr.

It is unusual, but not unheard of. Apparently, your partner was trying to avoid his previous obligations by starting a new business with you.

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Answered on 6/27/20, 9:14 am

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