Aa a new business owner am I responsible for merchandise sold bythe previous owner?
Get Legal Help Today
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
Aa a new business owner am I responsible for merchandise sold bythe previous owner?
I operate a garden center and lease the property. The name is the same as it has been since the original owner (who leases the land) had the store. The store closed over 6 months ago and I re-opened it 2 months ago. Previous operators sold $1000 worth of trees and plants to a man 1 year ago. He claims they all died and now wants me to replace them. He feels that since the shop has the same name I am liable.
Asked on May 10, 2011 under Business Law, Tennessee
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
The question is whether it is the same business entity as previously--e.g. the same limited liability company (LLC) or corporation (Inc.). If it is, then the company *may* be liable--IF there was some guarnty, warranty, etc.--which means that if you own the same LLC or inc. as had sold this man his plants, and there had been a guaranty or warranty, you'd have to honor it. However, if it's not the same business entity (even if it is the same name and address) and/or there had been no guaranty or warranty, then you would not be responsible. Business A is not responsible for what Business B did; it is only responsible for what Business A did, even if that was done under prior ownership.
IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.