Legal Question in Business Law in California

Re: Ca law regarding gift certificates

The question raises many sub issues regarding the purchase/sales of the business...as my esteemed co-counsel have so aptly pointed out.

Unfortunately, the only way for you to get a valid answer (it is unlikely they will honor just your asking for the information) is to file suit. Probably not the most economic means of getting an answer.

If you prefer, our office would be happy to send them a letter on letterhead to see if that sparks any better reaction.

Please feel free to contact me directly if you would like an attorney's assistance at 626-578-0708 ext. 4 or visit my firm's site online at www.RulesofEmployment.com

Scott

Re: Ca law regarding gift certificates

Well, the question is not so simple. It depends on the nature of the transaction between the original merchant and the new one.

Re: Ca law regarding gift certificates

The law says that a gift certificate is held in trust for the beneficiary. Thus, one could argue that the successor -- much like a new landlord -- holds the "deposit" in trust and must honor it.

Re: Ca law regarding gift certificates

If the new owner bought the entire business and still owns it all then he must honor the old certificates. If he simply bought the business's assets (the building, the equipment, the furniture, etc.) then he does not have to accept them, but the either old owner or some other purchaser still must honor them. The transactions may be much more complex than what I have described, and if that is the case it might not be easy to figure out who must honor the certificates.