Bob operates a flower shop and decides that to formalize the operation of the fl
ID: 442198 • Letter: B
Question
Bob operates a flower shop and decides that to formalize the operation of the flower shop, he will form a limited liability company (LLC) to own and operate the flower shop. After the LLC is formed, Bob hires David to drive the delivery van that is owned by the LLC and that is used to deliver flowers to customers of the LLC. One day when David is delivering flowers for the flower shop using the van, he runs a red light and collides with a car driven by Jan. Who can Jan sue for the injuries that she received in that accident? Are there theories of recovery that Jan can assert that might make Bob liable? What facts would be necessary for Bob to be liable to Jan?
Explanation / Answer
In this case as the Bob operates the Single Member LLC.
As the name implies, a Single-Member LLC is simply a limited liability company with one owner (member), instead of multiple owners.SMLLC'S are popular because they allow a single owner business to be treated like an LLC.
Asset Protection: As is the case with any LLC, the Single-Member LLC will act as a shield to protect his personal assets from the liabilities associated with the business conducted by the LLC..As the Delivery Van is owned by the LLC,so the Jan required plaintiff will be required to sue the LLC and not the owner(Bob)
As we have mentioned that like all LLC’s, a single-member LLC is designed to protect against personal liability. Accordingly, it should arguably be treated as a separate “person” for legal purposes, and thus the sole member/equity holder should be shielded from any liabilities of the LLC, including debts and lawsuits.
So the Bob cannot be make liable.
Bob can be made liable to Jan if Jan can prove that it is sole propertiership business and the delivery van is used for this purpose
.As the sole proprietorship, also known as the sole trader or simply a proprietorship, is a type of business entity that is owned and run by one natural person and in which there is no legal distinction between the owner and the business.The owners are personally responsible for business debts.