This corporation is a small restaurant in Canada. If there are debts need to be paid to the other companies and to the government, what is the liability of the major share holders and people who are involved.
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There are so many variables here so no one can give you a specific answer. Generally, a bankruptcy court will figure out: (1) Who is owed money by the restaurant (eg, the creditors) (2) What assets the restaurant has that can be sold to be paid the people who are owed money. (3) How much money each creditor gets. Generally, shareholders and individuals are not personally liable for the debts of the company, but there are many exceptions. |
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As long as the shareholders did not do anything illegal (including selling the assets and siphoning off the money before bankruptcy), there is no liability on the shareholders, given that the corporation is in good standing (all the records, board meetings etc. have been duly recorded). The creditors may allege fraud in the bankruptcy court, and the court will ask you to provide relevant documents etc. But again, as long as nothing illegal happened, there is no personal liability for the owners/shareholders. |
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