[WSBARP] CRE Transaction Question; Assumption of Liability/Indemnification?

[Rod Harmon]

If seller agrees to its continuing liability for the claim, put a paragraph about it in the purchase agreement.  Describe the claim and state that any liability on the claim is seller's and will continue to be so after closing.  Include an indemnity and hold harmless clause.  And state that this provision survives closing.
That solves any issue as between buyer and seller.  I do not think Tenant-2 would have any claim against buyer, so you don't need Tenant-2's agreement to anything.

Rod Harmon

RODNEY T. HARMON
       Attorney at Law
         P.O. Box 1066
      Bothell, WA   98041
     Tel:   (425) 402-7800
     Fax:  (425) 458-9096
    www.rodharmon.com<http://www.rodharmon.com/>
   rodharmon at msn.com<mailto:rodharmon at msn.com>

From: wsbarp-bounces at lists.wsbarppt.com <wsbarp-bounces at lists.wsbarppt.com> On Behalf Of Info Contact
Sent: Wednesday, January 17, 2024 3:47 PM
To: WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com>
Subject: [WSBARP] CRE Transaction Question; Assumption of Liability/Indemnification?

Hi Everyone,

Fact pattern: Buyer (also Tenant-1) is purchasing commercial property - the unit Buyer is currently occupying plus other units - from Seller (also Landlord). Seller (Landlord) was apparently sued by Tenant-2 at some point in the past (and lawsuit is on-going) for slip and fall injury in Tenant-2's unit. Tenant-2 claims Landlord did not repair the leak from the water line, resulting in standing water, causing Tenant-2 himself (not Tenant-2's patron) to slip and fall. Buyer is purchasing the property, not Seller's (Landlord's) business or entity.

Question: Does Buyer assume all assets, liabilities, and risk from Seller, including on-going claims/lawsuits? What's the best way Buyer can purchase the property but disavows such liabilities, if any?

Thanks in advance for your help!

--
Chanvir Singh (CJ)
Attorney

Prime Legal Services
14900 Interurban Ave. S., Suite 261
Seattle, WA, 98168
206.674.4585
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