Deepwater Dredging represents that it has corporate status to Estuary Marina when in fact Deepwater has not incorporated. The parties sign a contract that Deepwater does not perform. Estuary files a suit for breach. The court will likely hold that Deepwater is

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Deepwater Dredging is representing itself as a corporation to Estuary Marina, and Estuary Marina has relied on this representation by signing a contract with Deepwater. Therefore, Deepwater is a corporation by estoppel, which means that it is considered a corporation because of its conduct and the representation made to Estuary, even though it has not actually incorporated. As a result, Deepwater is liable on the contract for breach.

Deepwater Dredging Represents That It Has Corporate Status to Estuary