Legal Question in Business Law in Michigan

We have an LLC and will be closing our doors soon due to lack of suffiect fund to keep the operation going. We have just recieved notice of a law suit to collect from one of our vendors. In Michigan, are the partners personally liable if we shut down the company?


Asked on 2/05/13, 7:09 am

3 Answers from Attorneys
Timothy Klisz Klisz Law Office, PLLC

It depends on if the corporate structure was set up and followed properly. If not, it's called piercing the corporate veil. Then individual members can be held personally liable.

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Answered on 2/05/13, 7:14 am
Thomas R. Morris Silverman & Morris, P.L.L.C.

Under Michigan law (as well as the law of every other U.S. jurisdiction as far as I know), members in an LLC are not generally liable for debts of the LLC. There are exceptions, however, so it may be worthwhile to consult an attorney to help ensure a "soft landing" for the business as you wind it down.

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Answered on 2/05/13, 7:14 am
Brad Lambert Lambert & Lambert PLC

Yes, you take that risk to the extent you have taken money out of the company as owners, or will take money out of the company as you wind down operations. This is not a hard and fast rule, so you should consult with an attorney on the details.

This is just general information and does not constitute legal advice.

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Answered on 2/05/13, 7:22 am


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