Please pay the company you hired, not the owner or anyone else.
We have all hired a company to perform a service or sell us something when, at the end of the job, the owner says, “Just make the check payable to me.” This guy has been nice to you and you want to return the kindness, so you make the check payable to Joe Smith rather than Joe’s Roofing. He is paid, maybe he gives you a receipt and that should be the end of it. But what you may not realize is that you may have just participated in a fraudulent transfer.
If, for example, Joe’s Roofing ends up in bankruptcy (for any variety of reasons), its financial records may reflect the installation of the roof on your house but no record of the company having received payment. When you cut the check to Joe himself, he took it to his bank but did not record the payment in his company books. Or even if he did show it in his books, the money does not show up in the company’s bank records. So, a Trustee looking back on this transaction will see services provided with no payment. Depending on the circumstances, including the timing and the amount at issue, you could be sued. Now, you would still have defenses to this suit. But why put yourself in that situation in the first place? You can politely decline (and blame it on your lawyer) or tell Joe that you already wrote the check to the company and it’s in the other room.
Obviously, I am using this roof example for simplicity’s sake. But we come across this situation regularly in our personal lives and in business. I once had a corporate client who made a personal loan to the owner of his corporate landlord. The loan was repaid in free rent. (He wasn’t my client when he cut this deal.) Sure enough, the corporate landlord ended up in bankruptcy and my client was sued for unpaid rents. And though the rent had been paid by written agreement to reduce the loan, the corporate landlord received none of the loan proceeds. The Trustee asserted fraudulent transfer. Luckily we had other defenses that allowed my client to resolve it quickly. But my client could have easily ended up paying twice. (Of course, the guy who borrowed the money had disappeared.)
When it comes time to pay, please pay the proper party.