What are my liabilities for monthly rent after resigning from a corporation?

Asked over 1 year ago - Bayshore, NY

I am a board member and 1/4 shareholder in a small NY corporation set up for the purpose of running a small office (rent, copier, office supplies, insurance, etc). I have given a two-week notice of resignation as a board member. With nearly a year left on the office space lease, am I legally responsible for reimbursing my three business partners for my portion of the monthly rent. We have no written shareholders or rental agreement.

Attorney answers (5)

  1. Jeffrey Mead Kurzon

    Contributor Level 9

    5

    Lawyers agree

    Answered . No written rental agreement? All agreements with respect to real estate need to be in writing in New York. Who is the owner of the space? You may be able to wiggle out of this depending on the facts and how your partners and the landlord react. Assuming the potential liability is anything but negligible, you should get an attorney. And the next time you start a business with fellow shareholders, hire an attorney to draft a shareholders agreement for you. Do not be penny wise and pound foolish.

    Please note that this answer is not intended to serve as legal advice for any purpose. All legal advice rendered... more
  2. Richard J. Chertock

    Pro

    Contributor Level 17

    4

    Lawyers agree

    Answered . You resigned as a board member, but did you also surrender your shares in the corporation? If you did not then you are still an owner of the corporation and may still have some liability.

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  3. Jayson Lutzky

    Pro

    Contributor Level 20

    2

    Lawyers agree

    Answered . I agree with the prior responders with an addition. Did you sign any personal guaranties for the lease or any vendor? You can also request to surrender the shares or dissolve the corporation. Speak with a corporate lawyer in your area.

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  4. Marisa Andrea Corvisiero

    Contributor Level 6

    1

    Lawyer agrees

    Answered . I agree with my colleagues here. Mr. Chertock makes a good point, that I want to reiterate. Regardless of your resignation to the board position, you are still a 1/4 owner. Unless you return your shares you will continue to be responsible for expenses, liabilities and losses, not only those incurred up until your resignation, but also going forward. Being a board member is pretty much a title for a managerial position, which actually shields you from personal liability. Being a Shareholder is the trigger that makes you responsible. I'm worried that you may have given up some of your rights to make decisions but remain bound to the business as an owner. I'm an experienced corporate attorney with top law firm experience, please do feel free to contact me to help you sort this out. Best of luck!

  5. Roman Leonov

    Contributor Level 8

    1

    Lawyer agrees

    Answered . Mr. Kurzon is on point, but please, please make sure you have a shareholders agreement to avoid any future disputes. If you have no written lease, you may be in luck.

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