blaw 308, Business law II

it’s an assignment about chapter 42, (organization and financial structure of corporations ).

1)first is a Case brief and the case name is Krupinski v. Deyesso. It should be in IRAC format. I attach the case and format details below. For. the case brief before the IRAC format there should be one paragraph or two about the summary facts of the case and then should be IRAC format.

2)answering question number 5 and. 11.  ( I will attach the questions below.)

Fieldcrest in the name of
Its
5. George Richert agreed to retain Crye-Leike Realtors as
his sole and exclusive real estate agent to find a build-
ing for Richert’s business. The agency contract was
signed by Richert and by Colman Borosky for Crye-
Leike. All parties understood that Richert would soon
form a corporation that would be the actual party to
lease the building found by Crye-Leike. A month later,
Richert formed WDM Inc. Richert was president and
CEO. WDM never formally adopted the agency con-
tract with Crye-Leike. However, Crye-Leike contacted
various landlords for WDM, showed several proper-
ties to WDM, and prepared an offer to lease space
on behalf of WDM. All these efforts were done with
Richert’s full knowledge. When WDM hired another
real estate agent, Crye-Leike sued for breach of the
exclusive agency contract. WDM claimed that it was
not a party to the contract between Richert and Crye-
Leike. Was WDM correct?ers right of first
was Croker correct?
11. Stufft Farms was a Montana corporation that owned
and operated a family farm. The only shareholders
were five family members. The bylaws included a
share-transfer restriction stating that no shareholder
had the right to sell her shares without first offering
the shares to the corporation and shareholders at book
value. Neil Johnson offered to purchase all of Stufft
Farms’s shares. His offer was contingent upon all of
the shares being tendered to him. When four share-
holders accepted Johnson’s offer, the fifth shareholder,
David Stufft, who did not accept the offer, argued that
he had the right to buy the shares of the tendering four
shareholders at book value. Was he correct?
12. Josh Thomas, Jack Wiley, and Will Regis are threepersonally. Moreover, Krupinski argues that any assumption of
the agreement by Scharnhorst does not automatically relieve
Deyesso of any personal liability. Essentially, to prevail on sum-
mary judgment, Deyesso must prove that he was excused from
any and all liability when Scharnhorst assumed the employment
agreement.
“[A] preincorporation contract may be adopted, accepted, or
ratified by a corporation when properly organized, resulting in
corporate liability on the contract.” Katz v. Prete, 459 A.2d 81, 86
(R.I. 1983). A corporation impliedly adopts a preincorporation
contract when it accepts the benefits of the contract and renders
performance in accordance therewith. Id. Adoption of a preincor-
poration contract results in corporate liability on the contract. Id.
There can be no dispute that an oral agreement was made
between Deyesso, Viola, and Krupinski, and that, under the
terms of the agreement, Krupinski was to serve as a manager of
the club. Additionally, there can be no dispute that Krupinski
received compensation from Scharnhorst for services provided in
accordance with the terms of the agreement. Thus, there can be
no dispute that Scharnhorst accepted the benefits of the contract
and thereby adopted it. In support of his Motion for Summary
Judgment, Deyesso now urges the Court to find that he made
the contract as Scharnhorst’s promoter, and that he was released
from liability upon adoption thereof.
The term “promoter” has been defined in case law as “every
person acting, by whatever name, in the forming and establishing
of a company at any period prior to the company becoming fully
incorporated.” Gerffert Co. v. William J. Hirten Co., 815 F. Supp.
2d 521, 528 (D.R.I. 2011) (quoting Dickerman v. N. Trust Co., 176
U.S. 181, 203-04 (1900)). This definition is consistent with the
principle that “a corporation should have a full and complete
organization and existence as an entity before it can enter into
any kind of a contract.” Ireland v. Globe Milling & Reduction Co.,
20 R.I. 190, 38 A. 116, 117 (1897). Under Gerffert and Ireland, it
may be said that a promoter is an individual who makes a contract
on behalf of an entity that lacks the capacity to enter into the
transaction. Because Deyesso did not make a contract on behalf of
Scharnhorst prior to the company becoming fully incorporated,
under Gerffert and Ireland, he may not be considered a promoter.
However, according to the Supreme Court of Ohio, the legal
principles governing the relationship between a corporation and its
promoters are not based upon the principles enunciated in Ireland,
but are instead “derived from the law of agency.” Ill. Controls, Inc. v.
Langham, 70 Ohio St. 3d 512, 522 (1994). Because a corporation
may not have agents prior to becoming fully incorporated, see, e.g.,
Rees v. Mosaic Techs., Inc., 742 F.2d 765, 768 (3d Cir. 1984), under
Ill. Controls, a finding that a contract was made on behalf of an
entity lacking legal capacity to make contracts is not a condition
precedent to a determination that the individual who made the con-
tract was acting as a corporate promoter.
For purposes of the instant dispute, this Court is not required
to ascertain the nature of the rules governing Deyesso’s claim.
Instead, the Court finds that the motion for summary judgment
may be resolved on the basis that “whether a person is actually
a promoter is a question of fact to be determined by the trier
of fact.” McDaniel v. Serv. Feed & Supply, Inc., 271 Md. 371, 376
(1974) (citing 1 Fletcher, Cyclopedia Corporations § 189); see also
[Indus. Nat’l Bank v. Peloso, 121 R.I. 305, 307 (1979)].
For the foregoing reasons, Deyesso’s Motion for Summary
Judgment is denied with respect to the breach of contract allega-
tions stemming from Krupinski’s signing of the promissory note
and his termination as manager because resolution of such issues
are [sic] factual in nature and improper for the Court to deter-
mine on summary judgment.
Defendant’s motion for summary judgment denied with respect to
the breach of contract allegations.
[Note: There have been no further hearings regarding this
case. At the end of the above opinion, the court concluded
that “Counsel for Defendant shall present an order consistent
herewith which shall be settled after due notice to counsel for
Plaintiff.”]operational decisions of the business and (2) know that the judgment.
Krupinski v. Deyesso
2016 WL 1252726 (R.I. Super. Ct. 2016)
In February 1995, Ronald Krupinski met with Frank Viola and William Deyesso to discuss investing in an adult entertainment club,
to be named “Centerfolds,” in Providence, Rhode Island. At the meeting, Krupinski claims it was agreed that he was to receive a
33 percent ownership interest in Centerfolds, and when the club opened, he would work as a manager and earn a salary of $52,000
annually plus bonuses.
In May 1995, Viola purchased Scharnhorst as the operating entity for Centerfolds. Viola, Deyesso, and others became officers and
shareholders of Scharnhorst in December 1995 through appropriate corporate action.
Following the purchase, Krupinski began preparing the club for its opening, which officially occurred in February 1996. Due to an
issue with the adult entertainment license, the club was forced to close shortly after opening. As a result of Centerfold’s temporary forced
closure, Krupinski agreed to reduce his ownership interest in the club to 25 percent.
Krupinski again served as a manager of the club when it reopened in August 1996. Krupinski served in that capacity until July 1997,
when he claims he was terminated without cause and without justification. Krupinski did not have a written employment agreement
during his tenure as manager.
Deyesso claims Krupinski was terminated due to his participation in a purported credit-card scam through the altering of customer
receipts, improper conduct with the club’s employees, and excessive drinking.
The site where Providence Centerfolds operated was taken by eminent domain in 2001. Once Centerfolds closed and Deyesso failed
to timely locate a new building, Deyesso proceeded to open other clubs in Massachusetts under the name Centerfolds, using some of the
tangible property from the Providence club. Krupinski alleges that Deyesso breached the original agreement with him by excluding him
from participating in those new, additional clubs.
On October 7, 2005, Scharnhorst’s corporate charter was revoked by the Rhode Island Secretary of State due to its failure to file its
Annual Report for the year 2005. Krupinski’s original complaint was filed on July 10, 2007, and the current, operative complaint was
filed on February 8, 2012. On April 12, 2012, the court issued a decision dismissing Counts II through VIII of the complaint. Accordingly,
the only remaining cause of action in this matter-which is now the subject of defendant’s summary judgment motion-is Count I, setting
forth a claim for breach of contract brought individually against Deyesso.
Silverstein, Judge
Deyesso argues that he was acting on behalf of Scharnhorst in
his capacity as director when he terminated Krupinski’s employ-
ment and is thus not personally liable. To that end, Deyesso
maintains that Krupinski’s employment agreement-as a claimed
preincorporation contract-subsequently became the obligation of
Scharnhorst when the corporation was purchased. Scharnhorst,
according to Deyesso, ratified the employment agreement at the
agreed upon salary of $52,000 per year. Krupinski, in response,
contends that the oral agreement was entered into with Deyesso