Regarding dissolving partnership question - what liabilities am I likely to face from leasehold of business location, or

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Customer: Regarding dissolving partnership question - what liabilities am I likely to face from leasehold of business location, or bank originating loan used to purchase business?
Answered by Ben S. in 30 mins 7 months ago
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Ben S.
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Expert in: Family Law, Legal, Estate Law, Real Estate Law, Criminal Law, Employment Law, Business Law, Consumer Protection Law, Bankruptcy Law, Traffic Law, Personal Injury Law.

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Ben S.
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26756 Satisfied customers
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10+ years of experience
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Ben S.
10+ years of experience
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26756 Satisfied customers

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Ben S., Expert

Hello. Thank you for requesting me. I am out of the office at the moment but will return in about two hours. Can I respond further when I return?
Customer
please
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Ben S., Expert

Hi.  I think we are talking on two threads.

Is the business a corporation?  An LLC?  A partnership?  (These are all different from each other.)

Customer
I'm sorry, that was my fault. We filed as an LLC
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Ben S., Expert

Okay.

1. Did you personally guarantee the bank loan?  (My guess is YES, but I am just guessing)

2. Did you personally guarantee the lease agreement?  (My guess is YES, but I am just guessing)

Customer
to both.
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Ben S., Expert

Thank you for clarifying.

In that case, I am sorry to tell you that would be personally liable if the LLC (or the other member) fails to make the loan payments or the rent payments even if you dissociate yourself from the LLC.  That's the reason the bank and the landlord wanted you to personally guarantee the LLC's obligations - they did not want you to be able to just walk away from the LLC and be in the clear.

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I really wish I had better news for you, but I am ethically required to give you my honest legal assessment of the situation.

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Have I given you a satisfactory response (even if it is not what you were hoping I would say)?

Customer
You have, thank you. I'd rather have unpleasant truth, so I can take the correct actions.Thank you for your time.
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Ben S., Expert

You are welcome. It was my pleasure to assist you. Any bonus you think I have earned would be much appreciated. :)

Cheers!

And if you need help with a new legal question in the future, please use either the "Ask me a new question" feature on your “My Questions,” OR add me to your Favorite Experts list OR click on the following link and start your question with the words "FOR BEN S. ONLY": https://www.justanswer.com/law/expert-californialawyer/?rpt=3800

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