Legal Question in Business Law in Florida

I am the managing member of an LLC in FL. In April 09 the largest customer of the LLC filed for bankruptcy. They owned the LLC in excess of $30,000 at that time. There was no settlement with the creditors as the assets were minimal. Their closing forced the LLC to be dissolved. This was done in Jan '10 with state of FL and IRS. At it's closing the LLC owed approx $7,000 to independent contractors. Now one of the contractors is threatening me personally with legal action. Do they have any recourse or am I protected by the LLC?

Asked on 8/04/10, 7:07 am

2 Answers from Attorneys

Kevin B. Murphy Franchise Foundations, APC

Any attorney will say as long as the contract and dealings were just between the LLC and the independent contractor, they have no grounds to sue you personally. That doesn't mean they can't or won't. If they do, you will need to respond appropriately and file various motions to get it resolved. It is likely an idle threat. The cost of litigation would be greater for them than the amount owed, and they would not get that in the end anyway. Consult with an attorney in your area for specifics.

Kevin B. Murphy, B.S., M.B.A., J.D. - Mr. Franchise

Franchise Attorney

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Answered on 8/09/10, 7:18 am

Adding to Mr. Murphy, you need to know if you signed all papers with this contractor individually or as the Managing Member of the LLC. If so, that's good.

If it is a single member LLC, then you have a problem.

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Answered on 8/09/10, 7:23 am

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