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You may think that after ending a business, paying off creditors, and shuttering your windows, that you are finally free from any obligations that stem from the business. However, there are some issues you still need to think about. Lawsuits after a business dissolution are one of them. Here are some tips to handle any that may come your way. Please keep in mind that these are just tips. If you have an actual legal question, please consult an attorney.
Get An Attorney
If you are hit with a lawsuit, make sure that you get an attorney that you can trust and you know will be reliable.
If Someone Contacts You Directly
Do not ever admit any fault when you are speaking with an injured person or their attorney. Just refer them to your attorney. If they insist on speaking with you, just listen to what they have to say. You should also make sure to take notes during the conversation. Do not tell them about the status of your business.
Make Sure to Get Contact Information
Make sure that you have the person's name, contact information, and the nature of the claim.
Keep Corporate Records
Saving all of your business records will help you in case you are hit with a lawsuit after dissolution. Most states have laws that deal with disposing of claims against a dissolving or dissolved business. In most cases, even after the business is dissolved, it will continue to exist for the purposes of settling claims.
Know Statutory Time Limitations
Even before you get hit with a lawsuit, make sure you know the statute of limitations for any possible lawsuits that could arise. That way you can help your attorney dismiss lawsuits for time periods that have expired.
Check Out Your Commercial Liability Insurance Policy
Your insurance may be able to cover the costs that stem from the lawsuit. Call your agent and find out if it does.
If you feel like you are going to lose the lawsuit, consider settling outside of court. It could save you money from legal fees.