How liable is silent partner responsible for in restaurant when partner closed business without consent?

People often use the term silent partner. As a legal matter, that term is useless and means nothing. There is no state statutes that define silent partner or common law on silent partners. Moreover, your question relates to an LLC which means that this has nothing to do with partnership. An LLC is a different entity and there are different sets of laws at issue. So let's get to what matters. What matters is what most people fail to get, namely a written agreement regarding the rights and duties of the member (LLC has members, not partners). So, what are the written agreements about this partner and their investment? What does the written operating agreement provide? What is the state law at issue (choice of law provision)? You need to speak with a business attorney so they can review all agreements and all facts. Only then can you get legal advice. Good luck.

This is a very difficult question to address in this forum. There are far too many variables, etc. that need to be answered. Just to start with, you use the term silent partner – if you are a member and a manger of the restaurant, there is a good possibility you are on the hook for things like taxes, distributions for licenses, payroll taxes and distributions, etc. This is because the government generally holds all “partners” responsible for the operations of the company. The other contracts and things that were taken out in the company name, if no one signed personal, you probably don’t owe anything. Now, if your just a shareholder (member in LLC talk), or made a loan to the business, you are probably not on the hook for anything because you are just an investor. Another thing to explore is what are you owed? Depending on your status, the managing member may have breached their fiduciary duties to you as well as other “partners”. Then again, if you simply have a loan to the business, probably all you can do is get in line with the other secured and unsecured creditors. As I said, this is a very complex situation. What you really need to do retain get a good business attorney in the state the restaurant is in; one whom you can trust and share everything about the business with. You may also want someone in Michigan who can exert you rights under Michigan law, assuming you have any. Get prepared and get your Defenses in place. Do this sooner than later because the debtors, the employees, and the State and Federal government are going to be knocking on the door soon. Good luck. Respectfully, Russ Brown