Is a business purchaser libel for the businesses old debts?
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Is a business purchaser libel for the businesses old debts?
Asked on March 21, 2013 under Business Law, Florida
Answers:
M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney
Answered 11 years ago | Contributor
Possibly. It depends on what the terms of the buy-sell agreement provide. In other words, with what is stated in the sales contract. If nothing is so stated in the agreement, then the new owner could be held liable for all or part of the business's existing debts. Typically, however, there would be contractual language either providing that the former owner would be responsible for such debts/liabilites or that the new owner would take them over in exchange for a reduced purchase price, etc. Again, the contract of sale will control. At this point, you should consult directly wiht an attorney who specializes in commercial tranasactions. They can best advise after hearing the specifics of the case.
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