Who is liable for faulty car repair when the original company has been sold?

The new owner, the old owner or no one? We have a 9 year old car. Shortly after buying the car, a rock hit and cracked the front windshield. We had the windshield replaced, paying $280 out of pocket. This year we noticed rust and a leak at the windshield-roof junction. We took the car to a body shop for repair. They removed the windshield and found rust in multiple places too extensive to repair and replaced the roof for $2000. They took pictures to document the rust. In their professional opinion they believe the rust resulted from poor workmanship in the windshield replacement, with scratches and possibly no sealant being used to seal the replacement window.

Asked on December 7, 2012 under General Practice, California

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

The new owner of company would likely be liable IF the old company had been a limited liability company (LLC) or corporation (inc.) and the new owner purchased the actual LLC or corporation; in that case, they own the legal entity that had existed when the work was done on your car and can be liable, since there is a continuity of legal entities. However, if the new owner bought only the assets of the old LLC or corporation, or if the old business had not been an LLC or corporation, but rather had been a partnership or sole proprietorship, then the new owner would not be liable; in this case, the new owner did not take over the legal entity or its legal obligations, only its assets (e.g. name, lease, equipment, accounts receivable, etc.). In this case, you could try to sue the old owner/business, if you can find it--though be aware that there may be no more assets or income (e.g. the business may be out of business) with which to satisfy any amounts it may owe you.


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