Can I hold a business responsible for payment if owned by a mother company?

UPDATED: Oct 1, 2022

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Can I hold a business responsible for payment if owned by a mother company?

I have a window cleaning company. I was contacted by a local business to clean their windows. The business is owned and operated by a group and has filed bankruptcy, I have sent them legal notice

stating that the business hired me and not the mother company. The business remains open, do I have a case in small claims court?

Asked on September 7, 2017 under Business Law, Pennsylvania


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

Is the business that hired you an LLC or corporation and, if so, is it not the same LLC or corporation as the mother company? If the answer is "yes," then that business is its own entity, is responsible for its own debts, and can be sued if it will not pay. However, if the business is not its own separate LLC or corporation, it is most likely part of the mother; and if so you can only proceed against the mother; but if the mother filed bankruptcy, you may not be able to recover anything.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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