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In April, Cranson was asked to invest in a new business corporation that was about to be created. He agreed to purchase stock and to become an officer and director.
After his attorney advised him that the corporation had been formed under the laws of Maryland, Cranson paid for and received a stock certificate evidencing his ownership of shares. The business of the new venture was conducted as if it were a corporation. Cranson was elected president, and he conducted all of his corporate actions, including those with IBM, as an officer of the corporation. At no time did he assume any personal obligation or pledge his individual credit to IBM.
As a result of an oversight of the attorney, of which Cranson was un-aware, the certificate of incorporation, which had been signed and acknowledged prior to May 1, was not filed until November 24.
Between May 1 and November 8, the ‘‘corporation'' purchased eight computers from IBM. The corporation made only partial payment. Can IBM hold Cranson personally liable for the balance due? Explain.
Cutler Company was duly merged into Stone Company. Yetta, a shareholder of the former Cutler Company, having paid only one-half of her subscription, is now sued by Stone Company for the balance of the subscription.- Explain whether she is correct.
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