Wednesday, October 26, 2005

S.C. Supreme Court issues products liability opinion dealing with successor liability

In Simmons v. Mark Lift Industries, the state Supreme Court answered certified questions dealing with successor liability. Among other things, the Court held that a successor or purchasing company ordinarily is not liable for the debts of a predecessor or selling company unless (1) there was an agreement to assume such debts, (2) the circumstances surrounding the transaction warrants a finding of a consolidation or merger of the two corporations, (3) the successor company was a mere continuation of the predecessor, or (4) the transaction was entered into fraudulently for the purpose of wrongfully defeating creditors' claims.

The Court also held that a plaintiff may maintain a product liability claim under a successor liability theory against a defendant when there are one or more other viable product liability defendants. The status and availability of other potential defendants is irrelevant in determining the issue of a successor corporation's liability in a product liability action.

2 comments:

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