If a business is completely transferred can a creditor still apply a lien?
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If a business is completely transferred can a creditor still apply a lien?
If a business is transferred for no consideration (not to hide from a creditor or between famiy members) between an employer and a longimte employee. Can a creditor with a debt from 6 years prior, file a lien on the business and negate the transfer or make the new owner (employee) responsible for the debt?
Asked on October 11, 2011 under Business Law, California
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
In order to answer your questions as completely as I can, was the entire business (corporation or limited liability company) sold, or were just its assets? If the assets were sold, was there a recorded UCC-9 filing as to the assets with California's Secretary of State?
From what you have written, if there is a judgment lien against the business the new owner took ownership of the business subject to the judgment lien (abstract of judgment). If the lien is simply a claim that has not been perfected by the filing of a lawsuit, then most likely the claim is barred by all applicable statute of limitations in California as to theories of recovery.
I suggest that you consult with a business attorney for further answers regarding your question.
Good luck.
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