Legal Question in Business Law in New York

Consent to assign an agreement to a new company

Company A wants to sell its business to Company B. Company A has a third party agreement with Company C that must be assigned in order for Company B to take over. Company A has provided that it may assign the agreement to a third party, with Company C's consent, which cannot be unreasonably withheld. Company C refuses to consent, even though Company B is creditworthy and otherwise able to assume the agreement.

Is there a remedy for Company A?

Are there guidelines as to what reasons for withholding consent are ''unreasonable''?


Asked on 10/03/07, 3:59 pm

4 Answers from Attorneys
Robert R. Groezinger GroezingerLaw P.C.

Re: Consent to assign an agreement to a new company

Reasonability is a question of fact...left for a jury or judge to decide.

Good Luck

RRG

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Answered on 10/03/07, 4:03 pm
Michael Markowitz Michael A. Markowitz, PC

Re: Consent to assign an agreement to a new company

Assuming evidence exists concerning the fact pattern given, company A has a cause of action against company C for breach of contract. In other words, company C breached its contract with company A since it unreasonably withheld consent. See, Giordano v. Miller, 288 A.D.2d 181, 733 N.Y.S.2d 94 (2nd Dep't. 2001).

Damages would be loss of profit to company A from the sale to company C.

Mike.

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Answered on 10/03/07, 5:13 pm
Robert Davies The Davies Law Firm, P.A.

Re: Consent to assign an agreement to a new company

You have heard from two attorneys. Really, you know that you need some assistance from an attorney, first to try to force Company C to do the right thing, and then to sue Company C if needed.

Get a lawyer who advises businesses, and who also litigates in court. You need someone who can not just make a demand for you, but who also has the ability to fight for you in court to back up those demands.

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Answered on 10/03/07, 5:56 pm
Christopher Hoyt The Law Offices of Christopher W. Hoyt

Re: Consent to assign an agreement to a new company

You may have a cause of action against Company C, but the first thing you would need to know is what if any reasons Company C is giving for withholding consent. With that information you should speak with a business attorney to determine if bringing a legal action is appropriate. Please feel free to contact my office if we may be of any assistance in this matter.

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Answered on 10/03/07, 6:05 pm


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