Are the principals of a corporation personally liable for PACA trust debts?
If a produce buyer’s assets are insufficient to satisfy its PACA trust obligations, the company’s principals are secondarily liable for the debts if they had some role in causing the corporate trustee to breach the PACA trust or had the ability to control the PACA trust assets. The produce buyer, as the trustee of the PACA trust, is charged with maintaining sufficient trust assets to make full payment to its PACA creditors as bills become due.
Related Questions
- At what point in the life of the limited liability company are the organizers no longer personally liable for the company’s debts and obligations?
- What are the possible consequences of being personally liable for businesses debts and obligations?
- Are the principals of a corporation personally liable for PACA trust debts?
