What rights and protections does a single-member limited liability company (SMLLC) enjoy in terms of interactions with creditors? How does this compare to other LLCs with multiple members or owners?
This complex area of business law and litigation was recently explored in an article – titled Instead of Olmstead and Albright: Why Michigan Courts Will Continue to Protect SMLLCs Against the Members’ “Outside” Judgment Creditors – by Attorney Michael Willis and Attorney Samuel Gilbertson of Willis Law. The article was picked up and published in a recent issue of The Michigan Business Law Journal.
Within the article, authors Willis and Gilbertson discussed the case of In re Albright, 291 BR 538 (Bankr D Colo 2003). The case cast doubt over how SMLLCs will be protected from creditor advances and how liability for debts or finances reflected upon the single-member owner. Olmstead v Federal Trade Comm’n, 44 So 3d 76 (Fla 2010), a case that reached the Supreme Court, was cross-referenced to review preexisting rules and regulations put forth by the FTC and other court decisions. The ultimate conclusion, as reached by the highly-experienced and insightful Willis and Gilbertson, was that neither Albright nor Olmstead rulings were impactful enough to reasonably deter an SMLLC owner in Michigan from continuing operations as normal, or from forming a new SMLLC. Michigan’s statutes regarding SMLLC membership rights – blocking a creditor from using a judgment claim to seize judgment rights and assets, namely – are clearer and notably stronger than Florida’s and Colorado’s, which may have been a key component to the uncertainty and outcome of the referenced cases.
For the full story about SMLLC laws in Michigan, you should read the article written by Attorneys Willis and Gilbertson. Click here to visit the entire Michigan Business Law Journal publication, which features their article on page 51. (Login information may be required.)
Willis Law would also like to thank The Michigan Business Law Journal for including their article within its publication. As one of the most popular business journals in the state, if not the country, it is an honor to have the works of our attorneys featured within it, especially in regards to such an important yet intricate legal topic.
Do you require a business law attorney in Michigan for a case or claim of your own? Willis Law knows the ins and outs of banking law, formation entities, strategic business planning, and much more. Get started the right way by calling (888) 461-7744 or using an online contact form today.