If I have a service contract with a company, what happens to the contract if the company is sold?

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If I have a service contract with a company, what happens to the contract if the company is sold?

I signed a contract 37 years ago for elevator maintenance with Company A. It was for a 5 year term, automatically renewable every 5 years. The Company was sold to Company B 2 years ago. I have now decided that I want to contract a different company but Company B claims that I have a binding contract for the next 3 years. Is this true even though I never signed with Company B?

Asked on September 9, 2015 under Business Law, Florida

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

It is likely true
1 If A had been an LLC or corporation and the LLC or corporation itself had been sold, then B owns the entity with whom you contracted and can enforce the contract.
2 Even if the above did not happen, a contract like the one you describe can be "assigned," or sold or transferred, to another company to fulfill the contract unless the contract itself had stated that there was no assignment allowed It is likely that B took over the contract from A.


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