parent nodes: promoters

Southern-Gulf Marine Co No 9 Inc v Camcraft Inc

Facts
P (Southern Gulf)'s to-be promoter signs contract with D, representing P as Texas corporation: P actually incorporates in Cayman island
P discloses the incorporation change to D, who assents
D defaults
P sues D for specific performance, which claims defense on the ground that it didn't exist when contract was signed

Analysis

"(O)ne who contracts with what he acknowledges to be and treats as a corporation, incurring obligations in its favor, is estopped from denying its corporate existence..." Otherwise, a party contracting with a corporation of uncertain validity could escape his debts simply on the basis of that corporation's standing to sue. Furthermore, D's substantial rights under the contract are not affected by D's status. As a result, D shold be estopped from denying the corporate status of D.

See corporation law, promoters