bulk sales acts
- Laws, often encompassed in the Uniform Commercial Code, that require a business seller to publish notice of the sale, inform all creditors, and establish an escrow of the sales proceeds for a short time, during which creditors may file a claim. These rules are designed to prevent a business owner from secretly selling inventory and disappearing without paying existing creditors
- Under the bulk sales acts, the owner had to notify all creditors before selling their restaurant's inventory.
- The bulk sales acts required the retailer to set up an escrow of the sales proceeds, allowing creditors to claim within a certain period.
- Compliance with the bulk sales acts ensured the business owner couldn't run away without paying his debts after selling his stock.
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