Coopers & Lybrand v. Fox Case Brief
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Case Brief Summary & Legal Analysis
tl;dr: A corporate promoter hired an accounting firm for a corporation not yet formed. When the bill went unpaid, the court held the promoter personally liable because he failed to secure an agreement releasing him from that liability.
Legal Significance: Establishes the default rule that a promoter is personally liable for pre-incorporation contracts. The burden of proving an agreement to release the promoter from liability rests on the promoter, not on the creditor to prove liability.
Case Facts & Court Holding
Key Facts & Case Background
Garry J. Fox met with Coopers & Lybrand (Coopers), an accounting firm, to procure a tax opinion and other services. Fox informed Coopers that he was acting on behalf of a corporation he was in the process of forming, G. Fox and Partners, Inc. Coopers accepted the engagement knowing the corporation did not yet exist. The corporation was formed on December 4, 1981, and Fox became its president, a director, and principal shareholder. Coopers completed its work and billed “Mr. Garry R. [sic] Fox, Fox and Partners, Inc.” for $10,827. When neither Fox nor the corporation paid, Coopers sued Fox individually under a theory of promoter liability. Fox argued that Coopers had agreed to look solely to the corporation for payment. The trial court found there was no agreement, express or implied, obligating Fox individually and entered judgment in his favor, effectively placing the burden of proof on Coopers.
Court Holding & Legal Precedent
Issue: Is a corporate promoter personally liable for a pre-incorporation contract when there is no agreement releasing the promoter from liability?
Yes. A promoter is personally liable for a pre-incorporation contract unless the Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea
IRAC Legal Analysis
About IRAC analysis
IRAC (Issue, Rule, Analysis, Conclusion) is the structure professors expect in exam answers. Each LSD.Law brief states the issue, the governing rule with citations, the court's application of that rule, and the conclusion - the same reasoning pattern you will use on exams and in practice.
Legal Issue
Is a corporate promoter personally liable for a pre-incorporation contract when there is no agreement releasing the promoter from liability?
Conclusion
This case provides a clear framework for promoter liability, confirming that personal Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad
Legal Rule
A promoter is personally liable for contracts made on behalf of a Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in r
Legal Analysis
The court first determined that Fox was a promoter because he undertook Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur. Excepteur sint occaecat cupidatat non proident, sunt in culpa qui officia deserunt mollit anim id est laborum. Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur. Excepteur sint occaecat cupidatat non proident, sunt in culpa qui officia deserunt mollit anim id est laborum. Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur. Excepteur sint occaecat cupidatat non proident, sunt in culpa qui officia des
Flash-to-Full Case Opinions
Flash Summary
- A corporate promoter is personally liable for contracts made on behalf