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Marianne and Ellen want to form a corporation, Bridal Flowers

 

Customer Question

Marianne and Ellen want to form a corporation, Bridal Flowers Company, and thus retain the Bobbo Law Firm to prepare the articles of incorporation. Bobbo Law Firm files the articles of incorporation but Bobbo's paralegal forgot to have Marianne and Ellen sign the articles as incorporations. The state notices the omission, rejects the articles as defective, and sends it back to be signed and filed again. Meanwhile, Marianne and Ellen, thinking they now have a corporation commence doing business as a corporation and start to make contracts for the delivery of flowers for weddings. Unfortunately, they could not fulfill one contract with Brenda and Eddie and are now being sued individually and personally for breach of contract. Brenda and Eddie are also claiming emotional distress damages since their wedding was "ruined" due to the absence of the promised flowers. Marianne and Ellen claim that only the corporation, Bridal Flowers, is liable for the breach of contract and any damages. Marianne and Ellen under these circumstances are protected from individual personal liability by what corporate law doctrine?
Answer
De Jure Corporation
De Facto Corporation
Closed Corporation
Thinly Capitalized Corporation

 

Optional Information:
State/Country relating to question: Florida

Submitted: 380 days and 18 hours ago.
Category: Single Problem
Value: $25
Status: CLOSED

Accepted Answer

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Expert:  Lucy, Esq. replied380 days and 18 hours ago.

De Facto Corporation - it means that, when you go through all the steps to form a corporation, but there is a technicality that means that it's not completed, the law will treat the corporation as formed.

Expert TypePost-Doctoral Degree
Category: Single Problem
Pos. Feedback: n/a
Accepts: 0
Answered: 6/3/2012

Experience: Lawyer

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