Legal Question in Business Law in California

purchase of corperate store, and it's client liability

We own a franchise,we also manage a store for other people,they purchased what was a corperate runned store. part of the services include selling a 1yr and 2yr written service guarantee, but clients must follow certain guidelines or they can void their guarantee.the seller included in the contract the buyer must accept all client liability. the sellers' employee did not keep very good records and poor

documentation. as we go forward written service guarantees

need to be reviewed and signed. most clients are refusing to due so, several clients calim they were sold a life time

guarantee (there is no such thing) almost all clients are unaware of the guidelines to keep their guarantees valid.

i read the contract the only thing diclosed was a couple of former employees were term. for embezzelment. we are threatened daily with law suits because the clients were mis lead! i have spoken with the corp.'s(sellers) reg. manager and they were aware of these issues and client complaints (she was dealing with them) prior to the sale. i have 2 questions 1st how can these buyers go back on the sellers for their neglect and non-disclosure 2nd are the new owners liable for prev. owners neglect and can clients sue them or can they sue sellers


Asked on 10/01/04, 3:46 am

2 Answers from Attorneys
Amy Ghosh Law Offices of Amy Ghosh

Re: purchase of corperate store, and it's client liability

You need to seek advise from a franchise lawyer. Did you file UFOC with secretary of state? Please e-mail me in details.

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Answered on 10/01/04, 1:29 pm
Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Re: purchase of corperate store, and it's client liability

What are the terms of the agreement between the store owner and you under which you manage this second store? The terms of that agreement would govern responsibility for these service contracts (as between you as operator and the owner) and also would govern whether you can drop this contract operation, which sounds like a money-losing headache.

In any event, I think you are going to have to retain a lawyer to review your franchise and contract liabilities and responsibilities and to deal with the pending disputes.

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Answered on 10/01/04, 1:39 pm


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