Legal Question in Business Law in California

What was the form of the business--partnership, LLC, Corporation? If it is not a form that provides for limited liability, then you personally can be liable for the business debts. If the bank gave the business a credit card based upon the assets and liabilities of you two only, and you never informed the bank of your no longer being involved with the business, they could probably go after you for the business debts. They gave the business credit because of your assets and you can not now turn around and say its not my business anymore. The tax filings are something between the two of you and the IRS, but not with the bank. Try to get the bankruptcy judge to include all of the credit card debt with the business so you can make a smoke screen with the bank and try to settle for a discounted amount.

The other attorney is one point here. Banks don't normally extend credit to a new business; they want individuals on the line so they can go after their assets. If you signed the original credit application in a personal capacity, you're on the hook. Bankruptcy is one option. Consult with a good business attorney in your area for specific advice.

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

Franchise Attorney

The problem with a partnership is not only do you share profits, but you share losses. You are also responsible for partnership debts.

You should have canceled the credit card when you left the business. You say you opened the card in your name. It's your debt.