This case study is about Limited Liability Company known as 1138 LLC which was doing
business and hired a building from Siva on rental basis. Later on, the company becomes default
and assets of company were insufficient to pay to external debts. Nevertheless, Siva has suit
against the company, and initiated proceedings in court against Hess, the co-owner or partner of
1138 LLC company. The court has decided in favor of Hess as he is personally not liable for all
debts of company and his personal property cannot be sold out as the company’s nature was
limited liability.
The issue in this case study is determination of liability of debts, either is should be completely
fixed upon Hess or not. My opinion in this regard is as per decision of court, because Hess is a
single partner or co-owner of limited company, the entire liability cannot be fixed upon him as
far as concerned his share of business and nature of company which is limited[ CITATION sba11
\l 1033 ]. The limited companies always react and held responsible up to the share of investment
of its partners not up to their personal property as happened in Sole Trader ship.
The first question of this case study is what is the liability of a limited company regarding its
