Alan sells merchandise on credit to ABC Co.ABC fails to pay for the merchandise.Alan later discovers that ABC is not a corporation,but a partnership consisting of Alice,Betty,and Charles.Which legal doctrine might shield Alice,Betty,and Charles from personal liability?

Question

Quizplus · Accepted Answer

The legal doctrine that might shield Alice, Betty, and Charles from personal liability is corporation by estoppel. This doctrine states that if a third party reasonably believes that an entity is a corporation and acts accordingly, then the partners cannot later claim that they were not actually a corporation and avoid liability.

Alan Sells Merchandise on Credit to ABC Co