11 Aug Can a small corporation file a bankruptcy case without a lawyer?
People file pro se bankruptcy cases all the time. Corporations and limited liability companies sometimes try to do this. Bad idea. Very bad idea. People can file pro se bankruptcy cases because they are flesh and blood people. On the other hand, corporations and limited liability companies are considered “persons” only to the extent that the laws of any given state give them the rights of persons.
One important aspects of the artificial nature of a corporation or LLC is that they cannot appear in court without an attorney. So if a corporation or LLC tries to file a bankruptcy case “pro se” through its sole stockholder or chief executive officer, most courts will say that this petition is void – essentially an act which can only be done through an attorney.
Recently we became aware of such a case filed by a corporation “pro se” through its CEO. Rather than allowing it to be stricken, an attorney was obtained and she filed an amended petition almost immediately. No harm, no foul.
The moral of the story… while you have the right as a person to file a bankruptcy petition on your own, it’s usually a bad idea – sort of like a lawyer trying to fix the brakes on his car. But for a corporation or LLC, it’s not just a bad idea – it’s a non-starter.
Lakelaw represents corporations and limited liability companies in bankruptcy cases in Illinois and Wisconsin.
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