If I owe an original owner of a business money, do I also now owe the new owner?

I worked for a company for 12 years in the metal shop. About 7 years ago, I fell on hard times and began to take scrap to sell. No charges were pressed because I admitted my guilt.the shop was sold last year to a new owner. I am currently working on a lump sum payment to the old owner because no theft occurred after the new owner took over. If I make amends with the old owner and the debt is paid in full to him with documentation. Can the new owner try to civil sue me also for the money?

Asked on August 23, 2014 under Bankruptcy Law, Michigan

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

The answer is "it depends"--it depends on how the business was structured, how it was sold, and who owns the claim against you.

If the business was NOT an LLC or corporation, then you would owe the old owner--he's the person who had the legal claim.

If the business was an LLC or corporation, BUT the LLC or corporation was not sold, just the assets, and the claim against you was not specifically assigned to the new owner, you'd pay the old owner--he still owns the business entity (the LLC or corporation) which you stole from and to which you owe money.

If the business was an LLC or corporation and the new owner bought the actual LLC or corporation, you'd owe the new owner. (Technically, you still owe the LLC or corporation, but the new owner owns the LLC or corporation.)


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