Legal Question in Business Law in California

Without a few key missing facts, it is not possible to be very helpful. First, was the produce business incorporated, or an LLC; or, on the other hand, a partnership or sole proprietorship? This is key to whether personal liability (of your husband) is certain or just a remote threat.

Next, did he personally guarantee business debts?

Next, who is being sued? Your husband personally, or the business? Is the proceeding in state court or is it an adversary proceeding within the bankruptcy? Are you named as a co-defendant?

The debts of your husband can be satisfied out of community property, but probably not the debts of an incorporated business. You should become familiar with Family Code sections 910 and 913. Section 910 provides (in part): ".....the community estate is liable for a debt incurred by either spouse before or during marriage, regardless of which spouse has the management and control of the property and regardless of whether one or both spouses are parties to the debt or to a judgment for the debt." However, the debts of an incorporated business are NOT the debts of the owner of the business unless he personally guaranteed them or the veil-lifting "alter ego" principle can be applied.

FC section 913 provides that your separate property is not liable for community debts.

Be cautioned that there may be exceptions to any of these rules.

You should either re-ask your question with more details or contact a lawyer directly. I would be willing to give you a further analysis if you contact me by e-mail.