What to do if my mother had a contract for her life with a retirement community but they sold out and now the new company wants us to sign a new contract?
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What to do if my mother had a contract for her life with a retirement community but they sold out and now the new company wants us to sign a new contract?
Shouldn’t our old contract still be in effect or binding as long as she lives?
Asked on October 17, 2012 under General Practice, Idaho
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
The issue depends on how the new company bought the community:
If the community had been owned by a limited liability company (LLC) or corporation (inc.) and the new company bought the LLC or inc., then they are still bound by the existing contracts. In this case, the new company bought the legal entity which had signed, and so was bound by, the contracts.
However, if the new company bought only the assets of the old LLC or corporation, or the old company had been some other form of organization (e.g. a partnership or sole proprietorship), then the new company would only be bound by existing contracts if it agreed to be bound; in this case, it did not buy the legal entity which had contracted with your mother.
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