Corporation Shareholder Liability?

Miguel Koczela: Assuming he has done everything right, no, they cannot, but the laws vary between states.In my state, a shareholder is not liable for corporate liabilities.However, he is also the chairnman of the board, and the president of the corporation.If he got the loan, and signed it as "John Doe, President, XYZ Corporation", then that means it is a corporate debt ,and not a personal one. He also needs a resolution of the board of directors authorizing the loan.If he singed it just as "John Doe", then he assumed personal liability for the loan.Many banks will try to get the person to assume personal liability when they give a loan, if he signed such a form, he is probably screwed.He is liable for his personal actions, which were not in the interests of the corporation.Also, no bank can put a judgement on anything, that is for a court to do....Show more

Nadia Crauswell: There are a number of factors. Because he is a sole holder of stock in a S-Corp, the corpor! ation may not have qualified for the loan on its own merits. many times lenders will have them sign a personal guarantee.If your client signed anything that used his personal credit, assets or guarantees, they can come after him. Also if your client used any of the money from the loan for personal purposes, or in any other way comprimised the veil of the corporation.Otherwise a copration and individual are "different people"....Show more