Bill Text: HI HB2497 | 2014 | Regular Session | Amended
Bill Title: Corporate Successor Liability; Eliminated; Exceptions
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2014-02-14 - Passed Second Reading as amended in HD 1 and referred to the committee(s) on JUD with none voting aye with reservations; none voting no (0) and Representative(s) Cachola, Carroll, Creagan, Nakashima, Takumi excused (5). [HB2497 Detail]
Download: Hawaii-2014-HB2497-Amended.html
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HOUSE OF REPRESENTATIVES |
H.B. NO. |
2497 |
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TWENTY-SEVENTH LEGISLATURE, 2014 |
H.D. 1 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO LIABILITY.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. Chapter 414, Hawaii Revised Statutes, is amended by adding a new section to part XIII to be appropriately designated and to read as follows:
"§414- Successor liability; eliminated; exceptions. (a) Upon a sale, lease, exchange, or other disposition of property under section 414-331 or 414-332 from a corporation to a successor corporation formed under this chapter or chapter 414D, the successor corporation shall not be liable for the debts and liabilities of the predecessor corporation.
(b) Notwithstanding subsection (a), the successor corporation may be held liable if:
(1) The successor corporation expressly or impliedly agrees to assume the debts and liabilities of the predecessor corporation;
(2) The alleged transactions between the two corporations amount to a consolidation or merger of the corporations;
(3) The successor corporation is a mere continuation or reincarnation of the predecessor corporation; or
(4) Clear and convincing evidence proves that transferring the assets from the predecessor corporation to the successor corporation without the debts serves the fraudulent purpose of escaping debt liability.
(c) This section shall not apply to any liabilities arising from a tort action."
SECTION 2. Chapter 414D, Hawaii Revised Statutes, is amended by adding a new section to part XI to be appropriately designated and to read as follows:
"§414D- Successor liability; eliminated; exceptions. (a) Upon a sale, lease, exchange, or other disposition of property under section 414D-221 or 414D-222 from a corporation to a successor corporation formed under this chapter or chapter 414, the successor corporation shall not be liable for the debts and liabilities of the predecessor corporation.
(b) Notwithstanding subsection (a), the successor corporation may be held liable if:
(1) The successor corporation expressly or impliedly agrees to assume the debts and liabilities of the predecessor corporation;
(2) The alleged transactions between the two corporations amount to a consolidation or merger of the corporations;
(3) The successor corporation is a mere continuation or reincarnation of the predecessor corporation; or
(4) Clear and convincing evidence proves that transferring the assets from the predecessor corporation to the successor corporation without the debts serves the fraudulent purpose of escaping debt liability.
(c) This section shall not apply to any liabilities arising from a tort action."
SECTION 3. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.
SECTION 4. New statutory material is underscored.
SECTION 5. This Act shall take effect on July 1, 2112.
Report Title:
Corporate Successor Liability; Eliminated; Exceptions
Description:
Eliminates corporate successor liability except under specified conditions. Effective July 1, 2112. (HB2497 HD1)
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
