Rumbeck v. Premier Valley CA5
In 2006, at the full expanse of the real estate bubble, Larry Rumbeck (Rumbeck) sold the assets of his solely owned real estate brokerage, BP Realty, Inc. (BP), to Endsley, Inc. (EI), whose sole shareholders were William Endsley (Endsley) and Neil Weese (Weese). Endsley and Weese personally guaranteed the $800,000 note that EI executed in BP’s favor. By 2010, the bubble had burst and EI was over $2.4 million in debt, which included the note to BP. EI sold its assets to Premier Valley, Inc., dba Century 21 M&M and Associates (PVI) for an amount significantly less than its debts.
Rumbeck sued EI, Endsley, Weese, and PVI for breach of contract. Before trial, Endsley and Weese filed personal bankruptcy and were dismissed from the action, which proceeded against EI and PVI. At the bench trial, Rumbeck claimed PVI was liable on the contract because it was EI’s successor. The trial court rejected Rumbeck’s claims of successor liability, found in PVI’s favor, and awarded PVI i
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