Stanley J. How & Assoc., Inc. v. Boss

United States District Court, Southern District of Iowa, 1963.

222 F.Supp. 936.

Hamilton, pp. 288-292


Facts: Boss signed a contract with the plaintiffs, an architecture firm, to build a hotel.  Boss signed it as an agent for “Boss Hotels Company, Inc.”, which hadn’t been formed yet but was supposed to be formed in Minnesota.  Boss formed a company with a different name in Iowa instead.  There were problems with the building of the hotel.  How sued Boss personally for unpaid fees.


Issue: Should Boss be personally liable for the debts of the nonexistent corporation?


Rule: Boss, as a promoter, will be personally responsible for the debts of the corporation he was to form unless it was understood and intended that the new corporation to be formed will be the sole obligor.




Conclusion: Boss is held personally liable for the debt to How.


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