New Jersey Business Lawyers

Individual Liability for Debts of Insolvent Corporations

Can the shareholder, officer or director of a dissolved corporation be liable to creditors for corporate debts? Yes, under certain circumstances. When an insolvent corporation is discontinuing business and winding up its affairs, it is the duty of its officers, directors and shareholders to treat assets of a corporation as a trust fund and to distribute assets appropriately among its creditors.

A corporate officer or director may be personally liable to creditors for failing to comply with this standard. A corporate creditor may recover against assets transferred to officers, directors or shareholders after a corporation's dissolution. A creditor may assert a claim after the corporation is dissolved. In these difficult economic times, aggressive actions by creditors and prudent planning for insolvent corporations are a necessity.

Dedicated Counsel for Businesses in Newark, New Jersey

At Ehrlich, Petriello, Gudin, Plaza & Reed P.C., Attorneys at Law, we take very specific care when organizing your business. We know that business start-up or commercial reorganization issues can be complicated and complex.

Our business and corporate litigation lawyers offer effective advice on all business start-up issues, including issues in tax law and real estate.

After taking all of your business issues into account, we also can advise on organizational options, including:

• Incorporation
• Partnerships
• Limited liability companies

If you are in need of competent, reliable, and experienced business and commercial law attorneys, contact our firm today to discuss your legal matters with our knowledgeable legal team.

Use our business experience to your advantage. Do not hesitate to contact Alan Ehrlich from Ehrlich, Petriello, Gudin, Plaza & Reed P.C., Attorneys at Law. Call (973) 828-0203 today.