Q: I own a condo in a business name and my business partner is considering filing bankruptcy, would we need to sell condo?
So that I am not impacted, would we need to sell the asset in order to not have it taken in a bankruptcy? Are there any other impacts to me if my business partner goes through with this?
A:
Yes, there are "impacts" that concern you (I currently represent a debtor in a Ch. 7 who has been a general partner in a small business construction company which has had a non-bankrupt general partner as well).
A general partner is personally liable for the debts of a partnership. If (unstated) you have been a general partner in the condo business, then you are most probably personally liable for any debts of the partnership.
Partnership formation and operation, and termination, is generally controlled by state law. And most state law will apply to work a "dissolution" of the partnership when one general files for bankruptcy relief.
Consult with an experienced GA bankruptcy lawyer, who most probably needs to confer with bankruptcy counsel for the imminent bankruptcy debtor about the partnership debts. Do this to find your best path forward.
A: If your business partner files for bankruptcy, it could potentially impact the assets of the business, including the condo. The exact impact would depend on a variety of factors including how the business is structured and the specific circumstances of the bankruptcy. It is recommended to consult with a bankruptcy attorney to understand all potential outcomes and strategies to protect the asset, considering the detailed specifics of your situation.
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