How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Ask Roger Your Own Question

Roger
Roger, Attorney
Category: Bankruptcy Law
Satisfied Customers: 25986
Experience:  BV Rated by Martindale-Hubbell; SuperLawyer rating by West
Type Your Bankruptcy Law Question Here...
Roger is online now
A new question is answered every 9 seconds

With regards XXXXX XXXXX protection in the State of Florida.......I

Customer Question

With regards XXXXX XXXXX protection in the State of Florida.......I am lookingto protect a LLC that I have been a sole member of for many years. The LLC owns a piece of commercial real estate with some equity and has a commercial checking account with cash as well. Numerous (11) unsecured creditors will soon be serving me with lawsuits from unpaid bills from 3 years ago. One was ringing my doorbell tonight... I have read that adding your wife as a member will not hold up in court once a judgement has been secured. What about adding my 2 children as {members|minority stockholders and putting profits into their savings accounts accordingly. What are my other options to protect this LLC? I want to cover myself in advance of being served....not after.
Submitted: 1 year ago.
Category: Bankruptcy Law
Expert:  Roger replied 1 year ago.

Hi - my name is XXXX XXX I'm a Bankruptcy litigation attorney. Thanks for your question.

Unfortunately, adding members will not protect the LLC from its creditors. Instead, it would just be bringing in members who would also be inheriting his/her share of liability for the company's debt as a member.

Also, under the fraudulent transfer act, if you were to transfer interest in the LLC, it could be reversed because the law prohibits a transfer of assets once a person/entity is on notice of being sued or has actually been sued. Thus, that's not a good idea either.

The only way to protect your company from creditors is by filing chapter 11 bankruptcy. IF you do that, the creditors must stop any collection efforts because of the automatic stay provisions under the bankruptcy code. The chapter 11 will allow you to work out a payment plan to pay these creditors without them coming after you. It allows you to dictate the action instead of allowing to creditors to. You can work out a repayment plan and get it approved by the court to pay these debts to the creditors on your schedule instead of theirs.

Customer: replied 1 year ago.

Kirk. Although your answer is exactly what I did not want to hear, I appreciate it. Looks like I will move to plan B. Clear cash from corporate account, sell property and move funds to a residential property and claim homestead. I understand this is completely fair game for Florida but Chapter 7 or 11 would not be options with this plan.

Expert:  Roger replied 1 year ago.

I really appreciate you not shooting the messenger!

You should be extremely careful about transferring property/assets/money of the company because you could face issues and exposure under the fraudulent transfer act, which you can read here: http://law.justia.com/codes/florida/2005/TitleXLI/ch0726.html

A chapter 7 is a complete liquidate, which would mean that the business would shut down and lose everything. However, a chapter 11 would allow you to keep the business running and also pay these creditors over time at a monthly rate you can afford.

JustAnswer in the News:

 
 
 
Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.
 
 
 

What Customers are Saying:

 
 
 
  • Mr. Kaplun clearly had an exceptional understanding of the issue and was able to explain it concisely. I would recommend JustAnswer to anyone. Great service that lives up to its promises! Gary B. Edmond, OK
< Last | Next >
  • Mr. Kaplun clearly had an exceptional understanding of the issue and was able to explain it concisely. I would recommend JustAnswer to anyone. Great service that lives up to its promises! Gary B. Edmond, OK
  • My Expert was fast and seemed to have the answer to my taser question at the tips of her fingers. Communication was excellent. I left feeling confident in her answer. Eric Redwood City, CA
  • I am very pleased with JustAnswer as a place to go for divorce or criminal law knowledge and insight. Michael Wichita, KS
  • PaulMJD helped me with questions I had regarding an urgent legal matter. His answers were excellent. Three H. Houston, TX
  • Anne was extremely helpful. Her information put me in the right direction for action that kept me legal, possible saving me a ton of money in the future. Thank you again, Anne!! Elaine Atlanta, GA
  • It worked great. I had the facts and I presented them to my ex-landlord and she folded and returned my deposit. The 50 bucks I spent with you solved my problem. Tony Apopka, FL
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
 
 
 

Meet The Experts:

 
 
 
  • FiveStarLaw

    Attorney

    Satisfied Customers:

    3203
    Bankruptcy Lawyer. Experienced.
< Last | Next >
  • http://ww2.justanswer.com/uploads/FL/FLAandNYLawyer/2012-1-27_14349_3Fotolia25855429M.64x64.jpg FiveStarLaw's Avatar

    FiveStarLaw

    Attorney

    Satisfied Customers:

    3203
    Bankruptcy Lawyer. Experienced.
  • http://ww2.justanswer.com/uploads/TL/tleeders/2012-6-13_204815_TSL1.64x64.jpg Terry L.'s Avatar

    Terry L.

    Attorney

    Satisfied Customers:

    2204
    Better Business Bur 15yrs bankruptcy experience. Chicago Bar
  • http://ww2.justanswer.com/uploads/mnphillips2/2009-03-13_203105_10984459-249293407.jpeg Phillips Esq.'s Avatar

    Phillips Esq.

    Attorney-at-Law

    Satisfied Customers:

    950
    B.A.; M.B.A.; J.D.
  • http://ww2.justanswer.com/uploads/CO/cortrightlaw/2011-12-5_4117_Kevin.64x64.JPG cortrightlaw's Avatar

    cortrightlaw

    Attorney

    Satisfied Customers:

    490
    Attorney practicing Bankruptcy Law including Chapter 7, Chapter 11, Chapter 12, and Chapter 13.
  • http://ww2.justanswer.com/uploads/Jay1968/2006-12-03_004423_JoeRossPhoto.jpg JoeLawyer's Avatar

    JoeLawyer

    Attorney

    Satisfied Customers:

    376
    Attorney in the practice of Bankruptcy Law since 1996
  • http://ww2.justanswer.com/uploads/DY/Dylatess/2012-9-11_1968_BHBTemplePhoto.64x64.jpg dylatess's Avatar

    dylatess

    Attorney

    Satisfied Customers:

    370
    35 plus years of experience specializing in bankruptcy law
  • http://ww2.justanswer.com/uploads/US/USLawAnswers/2012-9-20_23143_20090105211638Headshot3b.64x64.jpg Brent Blanchard's Avatar

    Brent Blanchard

    Bankruptcy Attorney

    Satisfied Customers:

    315
    Twelve years experience in all aspects of debtor & creditor BK.