Standing Behind the Protection of the Corporate Shield

Flowing from the legal idea that there are two different kinds of "person" are the legal ideas that natural persons can own all kinds of stuff, including artificial persons, and artificial persons can own all kinds of stuff, including other artificial persons. As examples, a woman can own a house, a sculpture, and Dry Cleaners R Us, LLC; so too can Dry Cleaners R Us own a computer, 1 acre of land, dry cleaning equipment, and Little Petals Flower Shop, Inc.

It is against this background, that the owner (or member) of an LLC is viewed as being protected by a "corporate shield." If the woman in the example operates Dry Cleaners R Us, LLC correctly, claims against Dry Cleaners R Us, LLC for money are claims against the LLC only and ordinarily are likely to be satisfied by what the LLC owns (a computer, 1 acre of land, dry cleaning equipment, and the stock of Little Petals Flower Shop, Inc.); but these claims ordinarily cannot be claims against the woman and what she owns (a house, a sculpture, and the member units of Dry Cleaners R Us, LLC). What the woman owns ordinarily is protected from such claims; in other words the woman ordinarily is not "personally liable" to satisfy the claims against the LLC. The LLC must pay its own bills and claims; if it cannot pay, it should hire an attorney to discuss its options. But again ordinarily these issues have nothing to do with the woman's own, separate, personal affairs.

Claflin Law can help to protect your business from business liability and to protect you as a business owner from personal liability.