Central National Bank of Junction City v. Sheldon

Citations

• 86 Kan. 460
• 121 P. 340
• 1912 Kan. LEXIS 319

Syllabus

<p>SYLLABUS BY THE COURT.</p> <p>1. Corporation — Failure to Complete — Liability of Incorpora-tors as Partners. Without any statutory provision the law is that where a number of persons assume to organize themselves into a corporation and fail to take the steps which are essential to their becoming' incorporate they are liable as partners for debts incurred by them in the corporate name.</p> <p>2. - Same. Where a charter was regularly issued for a corporation under the laws of the territory of Arizona, but no meetings were called or held for the election of officers, and no books were opened and no capital stock was subscribed for or paid, held, that the organization was not completed, and that the incorporators were individually liable for debts incurred in the corporate name.</p> <p>3. Promissory Note — Executed in Nci/me of Pretended Corporation — Partnership—Estoppel. The holder of a promissory note executed in the name of a pretended corporation by one who assumed to act as president thereof before the corporation was completed is not estopped from maintaining an action to recover the amount of the note against the incorporators by reason of having procured an adjudication by a referee in bankruptcy to the effect that the note is the note of the corporation and not that of the individual who signed it as president. The action to recover against the individual is not upon the note but is based upon the fraudulent acts of the incorporators.</p> <p>4. -¡— Same. The liability for debts incurred in the corporate name extends to all who participate in the enterprise, and is of the same nature as would be imposed if the original plan had been to form a partnership.</p> <p>6. - Same. Persons who have held themselves out to the' public as officers and directors of a corporation, and have executed a promissory note in the name of a pretended corporation for money borrowed in its name, are estopped to claim that the corporation was not duly incorporated or that it exceed