Question
7. Arthur, Barbara, and Carl decided to form a corporation for bottling and selling apple cider. Arthur, Barbara, and Carl were to operate the business.
7.
Arthur, Barbara, and Carl decided to form a corporation for bottling and selling apple cider. Arthur, Barbara, and Carl were to operate the business. They went to Jane, a lawyer, who agreed to organize a corporation for them under the name A-B-C Inc., and paid her funds sufficient to accomplish the incorporation. Jane promised that the corporation would definitely be formed by May 3. On April 27, Arthur telephoned Jane to inquire how the incorporation was progressing, and Jane said she had drafted the articles of incorporation and would send them to the secretary of state that very day. She assured Arthur that incorporation would occur before May 3.
Relying on Jane's assurance, Arthur, with the approval of Barbara and Carl, on May 4 entered into a written contract with Grower for his entire apple crop. The contract was executed by Arthur on behalf of "A-B-C Inc." Grower delivered the apples as agreed. Unknown to Arthur, Barbara, Carl, or Grower, the articles of incorporation were never filed, through Jane's negligence. The business subsequently failed."
"A. Can Grower effectively sue Arthur, Barbara, and Carl, as individuals, why or why not?"
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started