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 Law Educator, Esq. Your Own Question
Law Educator, Esq.
Law Educator, Esq., Attorney
Category: Legal
Satisfied Customers: 117370
Experience:  JA Mentor -Attorney Labor/employment, corporate, sports law, admiralty/maritime and civil rights law
10285032
Type Your Legal Question Here...
Law Educator, Esq. is online now
A new question is answered every 9 seconds

Can a creditor go after an individual member of an already

This answer was rated:

Can a creditor go after an individual member of an already cancelled LLC?After I sold a small hotel and cancelled the sole member LLC entity that owned this hotel, a vendor presented bills and said they are past due during our ownership and had sent the bills to a collection agency.Questions:
1) Can this hit my credit for a LLC that has already dissolved?
2) My understanding is that as a sole member of a LLC, I am protected by law as an individual even though the LLC may owe money and the laws prohibit collection companies from turning individuals into the credit reporting companies. Is this correct?
3) Will I be able to have the creditor withdraw their submittal of their collection action? If not, what is the remedy?Thanks,
Thank you for your question. I look forward to working with you to provide you the information you are seeking for educational purposes only.
If you sold your business and properly wound up your LLC and dissolved it, then as a member and took proceeds from the sale, then the CA Court has held in CB RICHARD ELLIS, INC., Plaintiff and Appellant, v. TERRA NOSTRA CONSULTANTS, 230 Cal.App.4th 405 (2014), that you can be held liable to a creditor who was not paid.
So they can come after you personally if the LLC is dissolved and you took any proceeds from the sale. This would become a personal debt reported on your personal credit as the LLC no longer exists. So, legally because you dissolved the CA court says a creditor that was not paid can seek payment from the member of the dissolved LLC.
Please do not forget to leave positive feedback by clicking on the 5 stars at the top of your page , as the experts are not employees of the site and get no credit for spending time with customers unless they leave positive feedback. Thank you.
Law Educator, Esq. and 3 other Legal Specialists are ready to help you