Can a lien be put on a Non Profit for judgments against its Director who owes past rent and was just evicted?

Answer 1

To answer this question, I need to make the assumption the judgment in question is against the individual, who just happens to be employed by the Non Profit as its Director (executive director or merely a person on the Board?), and is for his or her personal debt. I also add the caveat that I am making the leap of faith that this would also be good law in your state, I am an Ohio attorney and am answering based on Ohio's laws. While Ohio's law on this topic is pretty mainstream, your state may be different, however unlikely that that seems.

It sounds like the only relationship that the Non Profit has to this debt is the fact that the debtor is an employee. The Non Profit would not be liable for the personal debts of its employee unless it guaranteed the payment or collection of the debt in writing. If it did, which would be unusual, you would then have to sue the Non Profit on that written guarantee.

One possibility is that if the individual is the employee ("executive director" rather than volunteer Board member "Director"), you may be able to garnish his or her wages paid by the Non Profit, or any other employer, for that matter. Your state may require that you have a lawyer handle the garnishment. You should also check to see what the usual court is that people use for collection purposes in your area. Here in Cleveland, even though you may have gotten a judgment in Common Pleas Court, most people transfer the judgment to the Municipal Court because people feel that that court is better equipped to handle the collection procedures. Ohio permits you to hold a "debtor's examination" to identify the debotrs assets. If you can do that in your state you will want to find out all of their banking information, real and personal property he or she owns, including any intangible property, such as stocks and possibly notes. The Non Profit may owe the Director money from current or past wages, or may owe the Director reimbursable funds for money loaned or advanced to the Non Profit.

Also, a non profit has "members" rather than "shareholders" as a for profit does. For Profit shares are an asset which could be seized by the court and sold to satisfy all or part of the debt. Non profit members have no such asset to be seized and sold, nor do they have any ownership rights in the assets of the Non Profit. Here, if a non profit goes out of business, the assets are not to be distributed to the members, but transferred to another non profit.

Check with a lawyer in your state, but it is unlikely that the Non Profit can be held liable for the debts of another. You may be able to get free legal advice from your local bar association referral service. Frequently, lawyers on the referral list agree to give a free initial consultation. Call your local bar association, ask for the referral service and ask them whether they have such an arrangement.

Answer 2

It is assumed the Director was an authorized officer of the non-profit corporation and thus authorized to sign the lease. You can sue the corporation in civil court to obtain a judgment lien. The non-profit may settle rather than have a judgment lien reported against it. You may profit by having a consultation with an attorney regarding your options.