Securing 3 properties from execution
The owner of a construction wholesaler needed to protect private assets. We implemented a structure that separated company risk from the house and plots.
Mr. Marek, the owner of a construction materials wholesaler, built his company and assets for 8 years. Unfortunately, in trade, one payment bottleneck at a contractor can pull down an owner's entire family. We showed him how to put up a legal wall between the company's debts and his private home.
The challenge
The client owned a house near Bydgoszcz worth about 740,000 PLN and two recreational plots. Everything was registered directly to him as an individual running a business. In mid-2023, his main recipient stopped paying invoices, which created a hole in the budget of 114,000 PLN.
Creditors began sending payment demands. There was a real risk that in the event of company bankruptcy, the bailiff would seize not only the goods in the wholesaler but also Mr. Marek's private bedroom. There was no clear separation of the private portfolio from business operations, which kept the client awake for 4 months.
Our approach
We started work with a quick audit of all entries in the land and mortgage registers and an analysis of the wholesaler's loan agreements. Our 3-person team (lawyer, tax advisor, and assistant) had to act precisely so as not to expose the client to a charge of asset shifting before a specific debt.
We designed a structure based on a family foundation and a transformation of the business's legal form. Every step was consulted with a notary in Bydgoszcz to maintain full transparency towards the tax office. The entire process lasted 87 days – from the first meeting at ul. Gdańska to the final entries in the registers.
The solution
We implemented a two-stage plan. First, we transformed the sole proprietorship into a limited liability company, which limited Mr. Marek's personal liability for new obligations. Then we established a family foundation, into which we brought the house and both plots.
This solution meant that the properties ceased to be Mr. Marek's property as an individual and became separate assets, managed according to strict rules. Additionally, we prepared a document circulation procedure that separated household expenses from company expenses. Now, even if the wholesaler encounters difficulties, the family has a secured roof over their heads.
Results
Thanks to the new structure, Mr. Marek regained peace of mind. Assets worth nearly 1.1 million PLN are safe, and the company operates in a form that allows for safer development and easier tax management.
Timeline
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October 2023Detailed audit of land registers and wholesaler debt
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November 2023Development of the foundation statute and documentation for KRS
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December 2023Visits to the notary and finalization of ownership entries
"Initially I was afraid of the costs and bureaucracy. The process took 12 days longer than planned due to an error in court, but the result is that I finally sleep soundly. No one will take my house because of a contractor's mistake."