I’ve heard a lot of advice about getting the property out of your name and into an LLC. What exactly does an LLC do to protect you? Any disadvantages as far as using the property as collateral? My attorney said that if a person slips on ice, falls and breaks their back on a property that is in an LLC, they can still sue the person whose name is on the LLC, as the paper trail leads to their door. So what good is it? Thanks for some insight. - PUP
The truth is you can sue anyone you want to for any reason, legitimate or frivilous. However, you must prove that the person/entity you are suing caused you damages. It is highly unlikely that they could pierce the veil of an LLC unless the members actually caused the negligence in their individual capacities or the LLC was not being run like a true company. I would heed JHyre’s advice and read the Bronchick articles. An ounce of prevention is worth a pound of cure.