If we bought out another company, can we automatically open a charge account for their customers?

Get Legal Help Today

Compare Quotes From Top Companies and Save

secured lock Secured with SHA-256 Encryption

If we bought out another company, can we automatically open a charge account for their customers?

Are they bound to our terms, finance charges, etc. and can we take them to court for non-payment if we don’t have a signature on file?

Asked on September 13, 2013 under Business Law, Vermont

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

If you bought the actual business structure--the corporation or LLC (if it was a corporation or LLC)--then you own the existing customer agreements and accounts and can use those. Since you own the existing business--it is still in place and still running, and only its shareholders or members have changed--all of its agreements, accounts, etc. are still in place. (Note that you cannot change terms without customer agreement, but are still bound to the terms that had existed.)

If you did not buy the company structure, but only bought the assets of the business, then no, you cannot open accounts for the customers or hold them to any agreements without their consent.

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

If you bought the actual business structure--the corporation or LLC (if it was a corporation or LLC)--then you own the existing customer agreements and accounts and can use those. Since you own the existing business--it is still in place and still running, and only its shareholders or members have changed--all of its agreements, accounts, etc. are still in place. (Note that you cannot change terms without customer agreement, but are still bound to the terms that had existed.)

If you did not buy the company structure, but only bought the assets of the business, then no, you cannot open accounts for the customers or hold them to any agreements without their consent.


IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

secured lock Secured with SHA-256 Encryption