business indiana
Survivability of agreement clause
<p>Landlord signs an agreement with a service to provide laundry equipment.  Later, landlord sells building.  The agreement has a clause that reads "this lease agreement will survive any sale, assignment, or other transfer of the apartment complex". The agreement is not disclosed to buyer. Is it enforceable by the laundry equipment provider?</p>

<p>It depends. </p>

<p>If the lease is not recorded, the question is whether the buyer has actual or inquiry notice of the lease, which will often be a close question of fact. If there was no actual or inquiry notice, the buyer is not bound if the machines were not a fixture. But, there are lots of ways that the buyer could be placed on inquiry notice without actually knowing about these terms in the laundry leases.</p>

<p>For example, if there are laundry machines on the premises, and there is no bill of sale in the transaction to convey the laundry machines, that might be enough to put a buyer on inquiry notice that there is a lease as to the laundry machines, which put the buyer on inquiry notice of the lease. And, if the buyer were on inquiry notice of the lease, then the buyer would be bound by any information that would have been discovered if he had made inquiry, whether or not the landlord actually did investigate.</p>

<p>Similarly, usually in the sale of business property, financial statements that would disclose the existence of a laundry machine lease would be disclosed, and a failure to insist upon seeing the lease document wouldn't prevent the buyer from being placed on inquiry notice as to the existence of a lease and bound by the lease.</p>

<p>In the case of laundry machines, it would also matter if the laundry machines were attached to the building or not. Fixtures are part of the land, and a lease is an interest in land, and a land owner cannot voluntarily convey land with fewer limitation than the land owner was subject to. But, if the laundry machines are not attached, then they are personalty, and so an unrestricted conveyance of land does not purport to transfer something that is not actually owned not subject to any disclosed or undisclosed leases by the landlord.</p>

<p>With the facts limited to those in the question, I wouldn't put money on who would win in court.</p>

<p>Also, even if the buyer is bound, the buyer might have a cause of action against the seller for failing to disclose the lease, or against the buyer's attorney and/or realtor for failing to do adequate due diligence regarding the purchase.</p>
