Case Name: James M. Gardner, Respondent, v. Fyr-Fyter Company, Inc., Appellant, and Stop-Fire, Inc., Respondent
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1975-01-28
Citations: 47 A.D.2d 591
Docket Number: Appeal No. 1
Parties: James M. Gardner, Respondent, v. Fyr-Fyter Company, Inc., Appellant, and Stop-Fire, Inc., Respondent.
Judges: 
Reporter: Appellate Division Reports
Volume: 47
Pages: 591–591

Head Matter:
James M. Gardner, Respondent, v. Fyr-Fyter Company, Inc., Appellant, and Stop-Fire, Inc., Respondent.
(Appeal No. 1.)

Opinion:
Order unanimously affirmed, with costs. Memorandum: In affirming Special Term'» denial of appellant's motion for summary judgment, we note that upon this record there are substantial issues of fact bearing on the question of the proper characterization of the transactions between Hew York Trap Rock Corporation and appellant's predecessor Fire Equipment Manufacturing Corporation (Fire Equipment). In form the transaction was a purchase of assets by Fire Equipment without the assumption of liabilities. Plaintiff-respondent Gardner alleges, however, that regardless of the form, the transaction was in fact and substance a merger with a concomitant assumption of liabilities (see Business Corporation Law, § 906, subd. [b], par. [3]). Although a purchase of assets may ordinarily be arranged so as to insulate the purchaser from the seller's liabilities, the purchase must he for fair consideration and undertaken in good faith as a bona fide transaction (Male v. Atchison, Topeka & Santa Fe Ry. Co., 230 N. Y. 158, 164; Cole v. Millerton Iron Co., 133 N. Y. 164). Here there are factual issues which preclude the granting of summary judgment. (Appeal from order of Allegany Special Term denying motion for summary judgment.) Present — Marsh, P. J., Witmer, Cardamone, Simons and Goldman, JJ.