MILWAUKEE CO. TO REQUIRE LLCs TO BE REPRESENTED BY AN ATTORNEY

It has recently come to my attention that Milwaukee County small claims court will in the very near future prohibit any individual other than a lawyer to represent a LLC's in court. This would mean that a landlord that owns his rental property in an LLC would no longer be able to appear in court to pursue his/her eviction case against a tenant. This is a change from how things have operated in the past and also different from what the law says in my opinion.

For those crafty landlords reading this who think that they will be able to circumvent this roadblock by merely filing the lawsuit in their individual names rather than in the name of the LLC that actually owns the property - you may want to read my earlier post entitled WHO MAY BRING AN EVICTION LAWSUIT.

As background, Wisconsin corporations have been required to appear in court through an attorney in large claims court since 1997 (Jadair Inc. v. U.S. Fire Insurance Co., 209 Wis.2d 187, 562 N.W.2d 401 (1997)). To date there is no case or statute that specifically requires an LLC to be represented by an attorney in large claims court although the reasoning for why only an attorney can appear in court on behalf of a corporation can quite easily be applied to an LLC as well.

Small claims court has been much different then large claims court however. In small claims court landlords have been able to appear in court themselves on behalf of their LLC because of §799.06(2), Wis. Stats. In essence the law says that as long as you are a full time employee of the LLC, or a member of the LLC yourself, you to represent the LLC in small claims court. While the statute prohibited most management companies from appearing in court for an LLC (since most management company employees are not full-time members of the LLC that owns the property but rather a full time employee of the management company that has been hired to manage many properties owned by various LLCs) at least the smaller landlord that owned and operated his/her own rental property could appear in court.

Apparently this will no longer be allowed as a friend of mine informed me that just this week he was warned by a Milwaukee County court commissioner that Milwaukee is preparing to require LLCs to appear in small claims court by attorneys only. Obviously this is going to put a financial strain on many smaller landlords that do not have the financial resources to retain a lawyer to represent their LLC every time they need to evict a tenant.

03/23/15 - UPDATE -- As a result of Act 76 (effective 3-1-14) LLC's no longer need to be represented by Attorneys.