Sole Member of LLC Is Not the “Owner” of LLC Property . 3519-3513 Realty, LLC v. Law (N.J. Superior App. 2009)

In 3519-3513 Realty, LLC v. Law, 967 A.2d 954 (N.J. Superior App.  Div. 2009) (slip opinion), the Court rejected an attempt by the sole member of an LLC to evict a tenant of a unit in a building owned by the LLC.  The statutory grounds for the attempted eviction was that the "owner" wanted to personally occupy the unit.  The Court refused to treat the building as owned by the sole member:

     Appellant argues that [the sole member]formed [the LLC] for the protection it afforded him individually in terms of potential liability.  [He] had every right to decide to arrange his affairs in that manner.  At the same time, he must accept the concomitant burdens that follow from the choice he made.

     Finally, appellant contends that adopting the trial court's construction unreasonably requires expenditure of money and time to transfer the property back to [the sole member's] name, individually, with the accompanying risk of incurring personal liability.  While not unsympathetic to the dilemma posed, we are not free to relieve [him] of the consequences which flow from the considered choices he earlier made.

posted by Gary Rosin

 

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