Mo Court of Appeals Says Hotel's New Owner Must Indemnify Former Owner's Debts

Summary

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Despite all of the expenses one businessman incurred as a result of an indemnity agreement, at least he can say he got his $100,000 back, as the Missouri Court of Appeals, Eastern District, sent a tedious, three-way business dispute back to the trial court for recalculation of attorney's fees and a fourth party's monetary award.

Perhaps Dipak Patel thought the half interest he bought for $300,000 in two hotel corporations would be profitable, but the indemnity agreement created a windfall loss because now he will have to pay two financial institutions that sued the previous owner and the corporations and wrap up any of the previous owner's remaining debts, mortgages and attorney's fees.

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Extract

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Mo Court of Appeals Says Hotel's New Owner Must Indemnify Former Owner's Debts

The agreement in dispute provided Rajen Jhala would sell his half of the interest in Bhavi Corp. and Subhali Corp. to Patel, who agreed to pay $100,000 up front and $200,000 following the sale of some property he owned with Jay Vidyalankar. Vidyalankar also owned Jhala's other...

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