Business Attorneys Orange County California Bulk Sales Law Part Three

Written by: Andrew Gale - Orange County - Small Business Attorney

Business Attorneys Orange County California Bulk Sales Law Part Three – A Processed Video Transcription

Business Attorneys Orange County California Bulk Sales Law Part Three .

Watch part one of the video here: Business Lawyer California Bulk Sales Law – Part One

Watch part two of the video here: Business Lawyers Orange County California Bulk Sales Law Part Two

 

Buying a Business and the Bulk Sales Law – What Does the Buyer Have to Do?

The buyer has to do four things:

1. The first thing they’ve got to do is they’ve got to go down and record at the County Recorder’s Office the fact that notice is being given to the creditors and typically the form is called “The Notice of Bulk Sale.”  There are specific things that are required to be placed into the notice and if you want to know what those are, read the link blog below that’s attached to it.  I set out all the specifics that needed to be contained in a Bulk Sale Notice here in the state of California.So first the notice gets recorded.
2. Secondly, the notice needs to be published and it must be published in a newspaper of general circulation and there are a lot of local newspapers that are set up specifically to be in the business of doing this kind of publication.  They know exactly what to do once you give them the notice and typically they charge a very small amount of money to do the publication.
3. Third, what you’ve got to do then is to give notice to the local tax collector by sending them a certified mail return receipt.
4. The fourth and most important thing that you must do is you must wait.

In the state of California, a buyer must wait at least 12 business days to give the creditors the opportunity to get the notice and to file their proper claims against the assets that are going to be sold.  The buyer wants to do all of this stuff before you give money to the seller.  The reason why is that once the money has gone over to the seller, more often than not it’s difficult, if not possible, to get the money back.  And now the buyer is in the situation of dealing with these creditors and having to pay the seller’s debts rather than saying, “Hey, go chase after the seller.  I gave him the money.”

So if you have a key takeaway here what you want to do is make certain:  (1) does the Bulk Sales Law apply to me; (2) if it does apply to you make certain that you comply; and (3) hang on to your money at least 12 business days until you know that the time period for having a creditor makes a claim has gone.

I hope that was helpful.  It’s a little bit complicated.  The bulk sales law is one of those many areas in business where I think it’s well-advised to have a small business person hire business attorneys Orange County California that know exactly what they’re doing.  Let the business attorneys become their trusted adviser to their business and you will be well-rewarded I think for the small amount of money that you’re going to pay to qualified business attorneys to help you deal with this kind of a problem and many others that come up in the life of a business owner.

Again my name is Attorney Andrew Gale of Gale and Vallance Business Attorneys Orange County California, and I hope this information helps you.