Pharmaceutical Sales and Consulting Corp. v. J.W.S. Delavau Co.
United States District Court for the District of New Jersey
59 F.Supp. 2d 398 (1999)
PSCC (plaintiff) contracted with Delavau (defendant) to earn commissions on sales it solicited, but when PSCC sued to recover unpaid commissions, Delavau discovered PSCC had never actually completed its New Jersey incorporation and moved to dismiss for lack of capacity to sue. PSCC's president had mailed the certificate of incorporation about six weeks after the contract was signed, and PSCC had since filed corporate tax returns and paid taxes using PSCC checks; PSCC argued it was either a de facto corporation or that Delavau should be estopped from denying its corporate status since Delavau had contracted with it as a corporation.
Whether, absent fraud, a party who transacted with a business as a corporation can later avoid contract liability by denying that business's corporate status.