Legal Question in Business Law in Texas

Re: Closing of business

Sorry about you situation. The inital question is whether you signed the lease as an individual or in the capacity of an officer of a corporation (or other legal entity). Secondly, did you personally guarantee the performance of the lease? This should be a part of the lease if it exists. Thirdly, does the lease have a "go dark clause"; a clause that excuses the remainder of the lease if the business entity fails.

Assuming that you personally agreed to be obligated on the lease, it may be very difficult to breach the lease without significant consequences.

I urge you to have an attorney review your lease and advise you as to possible options.

This reply is for informational purposes only and is not intended as legal advise. A client/attorney relationship is not formed by this answer.

If I can assist, please do not hesitate to contact me directly.

Jay Printz

Re: Closing of business

Assuming you are personally liable, it then becomes a question of what the landlord can do. Your home is exempt from judgement, as are your wages, $30,000 of personal property (60,000 if married) cash value of life insurance and other misc. items. Thus, is you are out of money the landlord has very little recourse. He could obtain a judgment, it would hurt your credit rating, but your exempt assets remain exempt. Once he relets the property your obligation under the lease should terminate, except for rent up to the point of reletting. If you are empoloyed tell the landlord not to call you at work, he must honor this request.

Re: Closing of business

Well, that all depends on your lease. If you personally guaranteed the lease, then you are likely on the hook. Probably a good course of action would be for you to get local counsel immediately, to see if there is something you can do to protect yourself. Additionally, you can see about getting a commercial real estate agent to relet the property. Normally, you are only responsible for the time that the property is not leased, so getting someone in there quick can lessen the impact.

Re: Closing of business

who is liable on the lease?