Legal Question in Business Law in Pennsylvania

I own a service business. Sole proprietorship. Assume my name is John Smith and my business is Perfect Smith Services. No fictitious name registration. I have contracts with clients under the name Perfect Smith Services. Signed by me. I want to sell my business to John Adams. My contract with my clients states: If Perfect Smith Services terminates or sells the business, Perfect Smith Services will notify the Client in writing and will assign this Agreement to another company. Client agrees to accept such assignment to another company/DJ.

My question is, so long as I notify my clients that Perfect Smith Services is no longer owned by me, am I liable if the new owner screws up? I signed the original contract. Thanks.


Asked on 5/24/12, 12:29 pm

1 Answer from Attorneys
Andrew Solomon Law Office of Andrew A. Solomon

I don't think that you can be held liable for services that you did not perform. Because your name is in the name of the business, it is somewhat questionable as to whether you needed to file a fictitious name registration. In any event, you can only be held liable for services that you perform and not for services performed by the new owner. This doe not mean that you cannot be sued. It only means that you have a pretty good defense to any case.

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Answered on 5/24/12, 1:10 pm


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