How does personal liability for business claims arise?
If you or one of your employees, in the course of employment, injures another person, that person may seek money damages in a court action against you. Examples include someone slipping and falling in an entrance way or office floor, an employee who thinks he or she faced unfair treatment, a customer who feels that you may have committed some negligent act that cost him or her money damages. Some of these risks can be covered by liability insurance, but they may not be adequate for the amount claimed or may be subject to exclusions. We live in a time when everyone sues if they think that they have been wronged and they can obtain a money judgment. If you have such risks and business is subject to bad times, you may have to file personal bankruptcy, when you could be in a much better position if you were a corporation. Another example is that both sole proprietors and partnerships are liable for the acts, including the negligence, of their employees. Partners are liable for the negligen
