If I’m considering investing with a partner in a gym, will I be personally liable if we sign a lease?

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If I’m considering investing with a partner in a gym, will I be personally liable if we sign a lease?

I’m investing cash for 20% partnership, other party is getting an SBA loan to finance rest. I do not want to sign a personal guaranty for the loan. Even if I don’t sign, am I still responsible if I co-sign the lease?

Asked on January 15, 2016 under Real Estate Law, New Jersey

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

Assuming you don't personally guaranty the lease, then it depends on how the business is structured, how you sign the lease, and who the lessee is:
1) Business is a corporation or LLC, the business is the lessee (the party leasing the space), and you sign as a manager, etc. of the business (it states that under the signature) line--you are not liable.
2) Business is a corporation or LLC, but you and the partner are the persons leasing the space and you sign personally--you are liable.
3) Business is not a corporation or LLC--then there is no separate entity to be responsible for the lease, and whomever signs it (you and/or your partner) are liable.
 


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