Q: Can you sue a corporation ?
My nephew paid to go to a trade school that is owned by the teacher. He sued her in small claims court, won, it was appealed and he won again, now she is saying he can not collect because she is a corporation and you can not sue her?
A:
I think you are asking the wrong question. Anybody and everybody can be sued for any reason but the real question is "who can you collect the claim, debt or judgement from?"
It sounds like your nephew won his case against the trade school which is a corporation but either: (1) the teacher was not included on the original lawsuit as an individual defendant or (2) the court only found that the corporation is liable for the judgment, not the teacher as an individual. Even though the teacher is the owner of the trade school (the corporation), generally she is not personally responsible for the debts of the trade school. This is referred to as "limited liability". Under the law, for most cases, a corporation is considered a separate legal entity from the shareholders of the corporation. For example, if you won a judgement against Microsoft, this does not mean that Bill Gates is personally responsible for that judgement. One of the reasons businesses set-up a corporation is so the shareholders can protect their personal assets from judgments that are filed against the corporation.
For the teacher to be personally liable for the debt, that typically requires suing the teacher in addition to suing the corporation AND the court deciding that the teacher is personally liable for the debt. Your nephew has to review the judgement of the court and see if the judgment is against the school only or the school and the teacher, as an individual.
There is also another possibility that the judgement was against the teacher individually but she has no assets to collect from. In other words, she is responsible for the debt but she does not have the money or assets to pay for the debt OR she had the debt discharged by the Bankruptcy Court.
Since I only practice in NJ, the information is based on the laws that are generally accepted in most states. Your state may have other laws that apply and you should contact a local attorney. Local attorneys can be found through the local county bar association or through an online search for attorneys experienced in litigation/business laws/collection laws in your nephew's state.
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