Yes, there’s a chance a member of an LLC could be held liable for harm caused by lead-based paint under the specific scenario you described. Here’s why:

• Housing Code Provision: The key factor is the housing code provision that holds liable any individual who “owns, holds, or controls” the title. This language goes beyond simply naming the owner and targets those with control over the property.
• Limited Liability vs. Personal Liability: LLCs offer limited liability protection, shielding members’ personal assets from most business debts and obligations. However, this protection has exceptions.
• Case Precedent: The case Allen v. Dackman (2010) offers relevant precedent. Here, an LLC member who didn’t directly manage the property was still found liable under a similar housing code provision because they were deemed to “control” the title.

Here’s a breakdown of the potential liability:

• LLC vs. Member:The lawsuit would likely target the LLC initially.
• Piercing the Corporate Veil:If the plaintiff’s lawyer can argue that the member personally controlled the property decisions, despite the LLC structure, they might try to “pierce the corporate veil.” This legal concept disregards the LLC’s limited liability shield and holds the member personally responsible.

Factors that could influence the member’s liability:

• Level of Control:The degree to which the member participated in decisions regarding the property, such as repairs or maintenance.
• Knowledge of Lead Paint:Whether the member knew or should have known about the lead paint and failed to take action.
• Direct Involvement:If the member directly managed the property or participated in activities that exposed someone to lead paint.

Recommendations:

• For LLC members who own rental properties, it’s crucial to consult with a lawyer to understand their potential liability under local housing codes.
• Landlords should be proactive in lead paint testing and remediation, especially in older buildings.

Overall, while LLCs offer protection, members can still face personal liability under certain circumstances, especially when a housing code provision broadly defines ownership and control.