QUESTION

Can a court judgement be transferred by the creditor to a related corporation

Asked on Feb 01st, 2013 on Civil Litigation - Texas
More details to this question:
I have a court judgement against a corporation I operate. The same shareholders have another corporation that can be used to conduct new business. Can court judgement against the currernt corporation be transferred by the creditor to the new corporation? LIttle or now assets will be sold to the new corporation
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1 ANSWER

Litigation Attorney serving Greenwich, CT
Partner at Hilary B. Miller
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In legal terms, you are asking whether a judgment against your corporation can somehow apply to a new corporation under common control which receives a transfer of assets. This is a good question and one which cannot be answered solely from the facts you have provided. Even though people incorporate their businesses for the purpose of limiting the liability of the stockholders, there are a number of circumstances when the corporate "veil" may be "pierced" or ignored. In order to provide a more definitive response, it would be necessary to know something about how well capitalized both businesses are, what the purpose of the transfer is, whether the transfer is for reasonable consideration, etc.
Answered on Feb 01st, 2013 at 3:13 PM

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