What is a successor company’s responsibility to honor the contract of the previous entity?

My wife visited an orthodontist 6 years ago for a consult regarding invisible braces. She’s always wanted to get her teeth straightened out. Eager and easily sold she paid in full on her first visit. Nearly $4,000 via healthcare loan.Unfortunately due to some personal circumstances, she was never able to receive the treatment she paid for. Now 6 years later she’s ready to revisit this. Since then, the company has exchanged hands a few times and has new owners. I’ve contacted them and they are not willing to accept full responsibility of the previous owners and are unable to get in touch with the previous owner but have offered some discount for treatment. Is this company legally responsible?

Asked on August 14, 2014 under Business Law, California

Answers:

Michael Goldstein / Goldstein and Clegg

Answered 6 years ago | Contributor

The statute of limitations on breach of contract is 6 years from the date of the breach, so that may be a hurdle you need to overcome.  With that said, you should review the contact or fee agreement signed.  It is also important to note, whether the new orthodontist simply purchased the assets of the previous one or the entire business.


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