Legal Question in Bankruptcy in Illinois

I understand that a business entity like LLC or LLP cannot discharge their debts by filing Chapter 7. But how can creditors collect if liquidated assets are insufficient to fully satisfy debts now that business is gone? Creditors cannot go after the principals of LLP or LLC personally right?


Asked on 11/23/11, 6:03 am

1 Answer from Attorneys
Roseanne Lynch Bankruptcy Counselors, Ltd

If the Principals have signed a personal guarantee then the Creditor may pursue them individually. Most commercial leases contain a guarantee and some bank loans. You need an attorney to review the various documents to determine if there is any personal liability.

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Answered on 11/23/11, 7:51 am


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