AA Interiors, a group of interior designers, owned, operated, and shared profits from an interior design business. They agreed among themselves as to pricing, and agreed that deviations of more than 10% from the normal prices for service would only be permitted upon majority vote of the entire group.

In April of 2017, the principals of AAI decided that they should incorporate the business. They sent necessary articles of incorporation off to the state capital on April 15, but articles were returned to AAI on April 20 because a page had been omitted in collating. On April 18 Ingrid Interior, one of the principals, signed a front-porch remodel contract with the Aces, folks well known in the community. In order to promote goodwill for more business, Ingrid gave the Ace's a 15% ($1500) price break on the remodel, and, knowing the incorporation paperwork had been sent off three days earlier, she signed the contract: "Ingrid Interior, Vice President, AA Interiors, Inc." That afternoon, on her way to the paint store to pick up paint samples for the Ace job, Ingrid's car and one driven by Paul Plaintiff collided in an intersection. Paul's car had a defective brake light and Ingrid was on her cell phone at the time of the crash. It was not until April 25 that proper articles of incorporation were accepted at the state capital for AA Interiors, Inc.

But Ingrid thought she'd make more money working for BB Interior (they paid more). Before she quit her job at AAI, she told all her clients that she would be leaving and could give them a "special deal" in a few days. She made a hand-written list of customers and took it with her when she quit, and shortly thereafter approached these people with some discounted services (the special deal). For the first six months Ingrid did very well. In fact, she "invested" some of her extra earnings in the lottery, and won $2000! After she began working for BBI, her new boss Barry Artful purchased 10 shares of AAI stock which became available, and then demanded, as a shareholder, to inspect AAI's books and records.

Ingrid took her car to Dubious' Used Cars for repair. After the repair was done Ingrid said, "Wow, it looks good! Thank you! In special thanks, I'll give you four hours of free interior design work in anticipation of the upcoming remodel of your showroom." Dubious said, "Great! Now, because I'm saving almost $400 on design services, I'll call Floor Company and order the slightly higher grade of laminate flooring I was looking at." And he turned to do so.

1. The remaining principals of AAI refuse to perform the kitchen remodel services for the Aces at the 15%-off price, asserting that Ingrid had no right to offer such a discount. What liabilities are created here and on whom?

2. If the Aces had cause to sue because of complaints about the front-porch remodel,

a) under what line of reasoning could they reach Ingrid's personal assets?

b) under what line of reasoning could they not reach Ingrid's personal assets?

3. a) Who will suffer damages (end up paying money out-of-pocket) in the case involving Paul Plaintiff, and why?

b) AAI is unhappy with Ingrid for soliciting away customers. Does it have a cause of action against Ingrid now that she's no longer there? Under what theory, and for what recovery?

4. a) AAI refuses to allow Barry Artistic to inspect the corporate books. If he were to sue to be allowed such an inspection, what result and why?

b) Ingrid had second thoughts about her promise of the free interior design advice, and, reading up on the legal elements necessary for a contract to exist, determined her promise lacked consideration and therefore was not binding her. Is she obligated to provide the work (or its monetary equivalent)?