Legal Question in Business Law in Michigan

From a President is he personally respondsible for all debt from a corporation

I have a accountant that did corporation tax returns dating back about 15 years ago. And I was president of the corporation and the corporation went under and he still was billing on the corporation to me personally. The total is about 17,000.00 dollars now. He is my personal account and handling a Land Contract for me personally and the Payments that are made He took and Applied them to the bill of the corporation and now he is paid in full and Im broke with no money and my question is am I respondsible for all the past corporation bills personally. He says Im respondsible for all the debt of the corporation. Is this true?

The bills first came seperated and then the statements combined the two accounts and was put in my personal account. Then the account was changed back to the corporations name and my personal charges and Corporate where combined under the corporations name. Then later is was changed to my personal bill and he has taken all the money for the last year to pay off the account. I personally owe him about 2,000.00 dollars personally not 17,000.00 dollars.

Can you please reply to this question about this matter.

Thanks so much


Asked on 10/16/02, 11:05 am

2 Answers from Attorneys
Patricia Prince Patricia Gormely Prince, P.C.

Re: From a President is he personally respondsible for all debt from a corporati

Assuming that you did not sign a personal guranty, if the Corporation was set up properly, and operated in a proper manner (i.e. as a separate legal entity) then your accountant can only collect from the Corporation and not you personally.

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Answered on 10/21/02, 4:40 pm
Don Darnell Darnell & Lulgjuraj, P.C.

Re: From a President is he personally respondsible for all debt from a corporati

Sounds like it is two-part problem. First, as long the land contract interest was not property of the corporation, the payments made on said land contract were improperly applied to pay corporation debts. Second, whether you are personally liable for the debts of the corporation depends on whether you agreed to be held liable. Officers and directors of corporations, if properly set up, aren't normally held liable for the debts and liabilities of the corporation. This is primary reason for setting a corporate identity.

Call me if you like,

Don Darnell

734/544-7676

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Answered on 10/16/02, 12:57 pm


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