Can I subrogate a claim from my LLC to myself?
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Can I subrogate a claim from my LLC to myself?
Can you subrogate a claim from your single member LLC to yourself to circumvent the ban on representation by a non-lawyer? In my state Ohio, I can’t represent my LLC pro-se, as that’s seen as practicing law by a non-lawyer.
But if I subrogate the LLC’s claim to myself, could I then represent myself pro-se in that claim? It’s a straightforward 700 breach of contract claim and getting a lawyer involved doesn’t make business sense.
Asked on October 1, 2019 under Business Law, Ohio
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 4 years ago | Contributor
You can't subrogate the claim from an LLC to a member: there is no subrogation right for that. What you can do is buy the claim--it must be for a reasonable amount, though it can be at a discount to reflect that winning is never guaranteed and litigagtion has costs--from the LLC, taking "assigment" of the claim. As an assignee, you can then litigate it. So you could pay your own LLC $350, say (a 50% discount, to reflect risks and costs of litigation), the sue for the $700 claim. If challenged in court by the defendant, you'd have to be able to prove (e.g. by cancelled check or other monetary transfer) that you purchased and paid for the claim.
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