Can you bring legal action against a corporation that has been dissolved involuntarily?
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Can you bring legal action against a corporation that has been dissolved involuntarily?
We purchased a home from a LLC. They had a bunch of work done to the home by a corporation they own. The corporation that did all the work was dissolved involuntarily. Can we take the LLC who owned the home to small claims court for improperly installed items? The LLC had a ton of work done to the home without a permit.
Asked on August 3, 2016 under Real Estate Law, North Dakota
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 7 years ago | Contributor
You can't sue a dissolved corporation: there is nothing to sue. But you may be able to sue the LLC which "hired" them (i.e. the parent LLC) if the LLC provided bad instructions (e.g. ordered them to cut corners) or did not properly supervise them. You may also be able to sue the corporation's owners (e.g. the LLC) under the legal theory of "piercing the corporate veil" if you can show that the corporation was a shell or a sham and that its assets (like it's bank account) were comingled with those of the LLC and the corporation did not have a legitimate independent existence but was just a pretense to try to defraud customers or creditors.
Be warned that the suits above are more complex than suing an existing company over breach of contract; you really need an attorney to have a decent chance of prevailing. If the amount at stake is not enough to justify hiring a lawyer, you may be better off, as a practial matter, of "writing this off" and not taking action.
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