KEN KIRSCHENBAUM, ESQ ALARM - SECURITY INDUSTRY LEGAL EMAIL NEWSLETTER / THE ALARM EXCHANGE You can read all of our articles on our website. Having trouble getting our emails? Change your spam controls and whitelist ken@kirschenbaumesq.com ****************************** When can you hold new owner to alarm contract with previous owner May 16, 2025 ********************** When can you hold new owner to alarm contract with previous owner ********************** Ken, Quick question in regard to the Commercial ALL IN ONE Security Agreement. If we just put a customer into an agreement and they sell their franchise to another party within a few months, does our agreement follow the business/site? We did an Alarm System for a new Pre-School, and the franchisee sold the business to another party and the other party, after few months, is saying they want to use a company they previously worked with for at buildings. I have a signed 5 year agreement with the previous owner. (Your all-in-one commercial agreement) Thanks, name withheld ************************ Response ************************ The quick answer is that a new owner requires a new contract; you can't hold the new owner to the old owner's contract. There would be many exceptions to this general statement. Let's address the questions you did ask first. One entity sold to another. You don't know the details of the sale, but it's certainly to a different entity though the seller and buyer likely do business under the same trade-franchise name. They are however, different entities and without more information we should assume the buyer has not assumed the seller's debts. In your scenario you do raise interesting issues. * You should not have continued doing any services, in this case monitoring, for the new entity unless it signed a new contract with you or an Assignment and Assumption Agreement of the old subscriber's contract. Obviously here to did continue to provide services and collect money from the new owner for several months. This option is stronger if you made it clear there was a contract, unless the new occupant made it clear they weren't accepting it, in which event you should have stopped service. * We don't know if the buyer, who is also the new occupant of the premises and the one using your alarm system, agreed to take over the seller's debts, including your contract. We do know that the new occupant has not signed an Assignment and Assumption Agreement, or a new alarm contract. * You could argue that even without an explicit agreement to assume the old contract the new occupant is now liable to perform under the old contract because it did, in fact but not in writing, assume the old contract by continuing to knowingly use the alarm system and make payments; there might be emails establishing the acceptance of the old contract. This is a weak option because the new occupant only needs to establish that it didn't know about a contract or made it clear it wasn't signing with you. You do have the option of going after the old owner. Send to K&K Collection Department. Sometimes an old owner will lean on a new owner to take-over the contract. ********************** STANDARD FORM AGREEMENTS: To order up to date Standard Form Alarm / Security / Fire and related Agreements click here: www.alarmcontracts.com *************************** CONCIERGE LAWYER SERVICE PROGRAM FOR THE ALARM INDUSTRY - You can check out the program and sign up here: https://www.kirschenbaumesq.com/page/concierge or contact our Program Coordinator Stacy Spector, Esq at 516 747 6700 x 304. *********************** WEBINARS: https://www.kirschenbaumesq.com/page/alarm-webinars *********************** ALARM ARTICLES: You can always read our Articles on our website at www.kirschenbaumesq.com/page/alarm-articles updated daily ******************** Wondering how much your alarm company is worth? Click here: https://www.kirschenbaumesq.com/page/what-is-my-alarm-company-worth *********************** THE ALARM EXCHANGE - the alarm industries leading classified and business exchange - updated daily ************************* PODCASTS: https://podcasts.apple.com/us/podcast/ken-kirschenbaum-presents/id1794851477 ************************* Getting on our email list / Articles archived: Many of you are forwarding these emails to friends or asking that others be added to the list. Sign up for our daily newsletter here: Sign Up. ************************** Ken Kirschenbaum,Esq Kirschenbaum & Kirschenbaum PC Attorneys at Law 200 Garden City Plaza Garden City, NY 11530 516 747 6700 x 301 ken@kirschenbaumesq.com www.KirschenbaumEsq.com
