If someone successfully sues a sole proprietorship,he or she must exhaust the assets of the business before going after the principal's personal assets.

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Quizplus · Accepted Answer

This is known as the principle of business entity. A sole proprietorship is a type of individual business where the owner and the business are considered one entity. In case of a lawsuit, the plaintiff can only pursue the business assets and not the individual assets of the owner until the business assets have been exhausted. This is to protect the business owner's personal assets from being targeted in case of any legal action against the business.

If Someone Successfully Sues a Sole Proprietorship,he or She Must