Could my parents be held legally liable if someone sued my business under a sole proprietorship in my name?
Get Legal Help Today
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
Could my parents be held legally liable if someone sued my business under a sole proprietorship in my name?
I live in my parent’s house, and I just wanted to be sure that my parents would NOT be liable if in the extremely unlikely event someone sued my business it would be a small online-based business. Could it be possible for someone to go after my parents since I am technically ‘operating’ in their house? Or not does it not work like that because the business is in my name and not theirs?
Asked on February 23, 2017 under Business Law, Massachusetts
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 7 years ago | Contributor
They would potentially legally be liable if they were involved in some way in your business or in the violation, act, infringement, etc. which caused the lawsuit. That means that if they let you live there for free (providing you the office space for free), let you use their internet, or otherwise provide the resources you used to do something wrongful, they could possibly be liable--certainly, even if in the end, they could defend themselves by showing that they are not in any real way involved, they could very plausibly be sued and forced to defend themselves against the lawsuit. You want to establish an "arms length" relationship and provide as much of your own resources as possible, to insulate them: e.g. provide/pay for your own internet and phone; use your own computer, which you can show is only yours and not a family computer; maybe pay them rent (with a written lease) for the portion of the house you use for the business (even if only $100 - $200 per month for a corner of a room and a desk); etc. (And if your business can't support such minor costs, it's probably not worth pursuing.)
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 AttorneyPages.com 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.