Chapter 28 4. Enstrom purchased an aircraft from the Interceptor Corporation. Wh

Question

Chapter 28 4.   Enstrom purchased an aircraft from the Interceptor Corporation. When the aircraft crashed due to a design defect, Enstrom sued Interceptor. However, when Enstrom found out that Interceptor’s assets Page 702had been purchased by the Interceptor Company (IC), it asked the court to join IC as a new defendant. IC argued that it was a different corporation involved in a different business. IC further argued that it had simply purchased the assets of Interceptor and was now involved in selling those assets, like the aircraft, to other buyers, like Enstrom. IC concluded that it was therefore not liable to Enstrom. Was IC correct? Why or why not? [See: R.J. Enstrom Corporation v. Interceptor Corporation, 555 F.2d 277 (10th Cir.).]

Explanation / Answer

Legally the owners are liable for all the claims made for any of the products made by them. When the company buys another company then all the claims and legal damages are transferred to the new company.

In this case Interceptor Corporation can't deny upon the legal charges upon its past company and is totally liable to the claims made by Enstrom. Company is a legal identity and is considered as a person in terms of legal language. Here the owners of Interceptor Corporation are safe but Interceptor Corporation is liable to Enstrom

If Interceptor Corporation have purchased the parts or assembly parts or the aircraft as a whole then Interceptor Corporation must forward tis case to the producers from which Interceptor Corporation have purchased parts or aircraft as a whole. But at the moment Interceptor Corporation is liable.

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.