Legal Question in Civil Litigation in Florida

Limited Liability Corporation Debt/Judgment Responsibility

If a person forms more than one LLC and that person is the sole proprietor and is forming such corporations to avoid any kind of personal liability and the LLC has no assets other than the property named, my questions are: 1 - Is this a correct/legal use of the LLC and 2 - If a person is injured by a product or as the result of a hazard caused by the property of the LLC, can the person recover a monetary judgment and enforce this monetary judgment by the taking of the property?

Thank you for your assistance.


Asked on 8/28/02, 8:57 pm

2 Answers from Attorneys

Charles Aspinwall Charles S. Aspinwall, J.D., LLC

Re: Limited Liability Corporation Debt/Judgment Responsibility

There is no limit to the number of LLC's one may have. So long as they are properly conducted according to law they will be effective to limit liability. If they are simply a fraudulent front, then they may be disregarded and the manager can be held personally liable for the debts of the LLC.

Judgments are enforceable against an LLC to the extent of its assets, and against the manager personally if the corporate veil is pierced because the LLC is a sham or "front" device.

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Answered on 8/29/02, 11:15 am
Peter Gonzalez Sanchez-Medina, Gonzalez, Quesada, Lage, Crespo, Gomez & MachadoLLP

Re: Limited Liability Corporation Debt/Judgment Responsibility

An "LLC" and a "sole proprietor" are two different things. There is nothing wrong with one person being the sole member of an LLC or several LLCs, each of which own real property. If one files suit against the LLC as a result of an injury occuring at the property, which is presumably the asset of the LLC, then of course one can try to pursue that asset after obtaining a money judgment (if any) against the LLC. If the LLC had insurance on the property at the time of the alleged incident, then such coverage may cover any money judgment (up to the policy limits), which would relieve your attorney of the additional work and risks associated with pursuing collection of the judgment. Indeed, if a carrier is involved and the case has merit, a settlement may likely result before ever getting close to the point of going to trial. Good luck.

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Answered on 8/28/02, 9:58 pm


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