IF THE COMPANY FILES FOR BANKRUPTCY

CAN COMPANY CREDITORS GO AGAINST THE STOCKHOLDERS?

Client owned two companies. Both are S corporations. One is a New York company. The other is a Nevada company. Before the pandemic, the New York company revenues were about $1.0M yearly with some profits. The Nevada company revenues were about $800,000 yearly with some profits. Each had its own retail outlet. All decisions were made by the CEO and owner who was based in Los Angeles. Just before the pandemic started the New York company got an SBA loan of $150K while the Nevada company got an SBA loan of $100K. Then the pandemic hit and revenues went south of the border. So now it is almost 5 years since the loan was obtained, and SBA demands resumption of installment payments.

The question is, can SBA collect the $150K and $100K from the owner of the 2 companies? First, SBA does not require personal guarantees for amounts below $200K. We checked the SBA loan documents and concluded that each loan had no personal guaranty. Therefore, in this case, Client decided to file Chapter 7 bankruptcy for each company here in LA. We just concluded the hearing for the New York company and the trustee after conducting the hearing by zoom, concluded that it was a no-asset case and the company is indeed bankrupt…that’s one down, one more to go. The hearing for the Nevada company is next month.

It is important to note that the conclusion of the trustee that the NY company is bankrupt or has no asset is a formal court record with notice to the SBA that this company is bankrupt. Client can then proceed to dissolve the company knowing that the no-asset order of the trustee proves conclusively that in the dissolution application with the secretary of state, all assets of the company has been used to pay the debts of the company and the company is indeed bankrupt.

Second, since there is no personal guaranty in this case for both company loans, the SBA cannot sue the CEO owner to collect on the $150K and $100K.

   CAN CREDITOR OF HUSBAND PUT A LIEN ON THE HOUSE OF WIFE THAT IS HER SOLE AND SEPARATE PROPERTY?

Client and husband were married 15 years ago. A week before they got married, they executed a prenuptial agreement where they agreed that Client’s income will be hers alone and husband’s income will be his alone and whatever assets each spouse purchases during marriage belongs only to whoever purchased the assets, the other spouse will have no ownership interest in such assets whatsoever. They agreed that there will be no community property asset in their marriage.

Husband operates a business that stops operating because it is losing money. The landlord sues the husband for unpaid commercial rent of $100K. Creditor obtained a judgment for $100K against husband and puts a judgment lien on the sole and separate property of client.

Is the judgment lien on the property of client wife a valid lien…No it is not. Why? Because of the prenuptial agreement, there is no community property interest of the judgment creditor spouse on the sole and separate property of client.

Disclaimer: None of the foregoing is considered legal advice for anyone. There is absolutely no attorney client relationship established by reading this article.

PRAYING ALWAYS HELPS

It also helps to pray to our God, His beloved Son, Jesus Christ, and the Blessed Mother Mary for divine protection against financial problems, because we have a God who loves us and His beloved Son, Jesus Christ, showers us with infinite mercy. All we have to do is humble ourselves and pray to the Sacred Heart of Jesus for a drop from his ocean of infinite mercy. Jesus revealed in 1930’s to Saint Maria Faustina Kowalska of Poland that all sinners which we all are and those who do not believe in God and those who do not yet know Jesus, should all be brought to His sacred heart and be submerged in the ocean of His infinite mercy, for the sake of His Sorrowful Passion. Anything you ask for when you pray the chaplet for His divine mercy will be granted, if compatible with His will. Moreover, you are guaranteed a peaceful death.

What is the current proof that God and Jesus are divine and all powerful? I refer to exhibit A, the incorruptible body of Carlo Acutis!

CURRENT ONGOING PHYSICAL PROOF GOD IS ALMIGHTY

INCORRUPTIBLE BODY OF CARLO ACUTIS DIED 2007 AT AGE OF 15

Look at the incorruptible body of the blessed Carlo Acutis who died at 15 in 2007. You can look at his body in Rome, Italy, now 14 years after his death. He looks like he’s just asleep in his jogging suit and rubber shoes!  That is a perfect example of an ongoing sign on earth that the God of Moses, our God, my God, is almighty and all-powerful that He even suspends the natural laws of biology and physics without any effort. He resurrected His one and only beloved son from death on the cross. Indeed, He has power over death.

I have thought, “What would the other religions believe if they saw the incorruptible body of the blessed Carlo Acutis? I think even Buddha, if he were alive today, would believe that Yahweh is the one True God.” No need to think about reincarnation and nirvana because his incorruptible body is available for all to see in Rome, Italy. We will not need any kind of explanation on the efficacy of modern-day mummification. Come on, man, which is all bull. The truth is in plain sight. Believe your own eyes that the one true God is all-powerful, and His name is Yahweh, “I am ++who Am.” He is the alpha and the omega, the beginning, and the end.

“ETERNAL FATHER, WE OFFER YOU THE BODY, BLOOD, SOUL AND DIVINITY OF YOUR DEARLY BELOVED SON, JESUS CHRIST, OUR LORD AND SAVIOR, IN ATONEMENT FOR OUR SINS AND THOSE OF THE WHOLE WORLD, FOR THE SAKE OF HIS MOST SORROWFUL PASSION, PLEASE HAVE MERCY ON AMERICA AND THE WHOLE WORLD.”

Lawrence Bautista Yang is a graduate of Georgetown University Law Center and has been in Law practice for thirty years.  He specializes in Bankruptcy, Business and Civil Litigation and has handled more than five thousand successful Bankruptcy cases in California.  He speaks Mandarin and Fujian and looks forward to discussing your case with you personally.  Please call (626) 284-1142 for an appointment at 20274 Carrey Road, Walnut, CA 91789 or 1000 S Fremont Ave., Mailstop 58, Building A-10 South Suite 10042, Alhambra, CA 91803.