e Ch ?? Review Submission History: a CHAPTER 40 READING Assi Chapter 38 wntten A
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e Ch ?? Review Submission History: a CHAPTER 40 READING Assi Chapter 38 wntten Ass X | + v. 174994-dt-content-rid 899309 1/courses/201801-DUT-BUS-216-61A/201801-DUT-BUS 216-61A ImportedContent 2017 In August 1995, Smith Company ("Smith") entered into a lease with Jones Two, Inc.("Jones"). By the terms of the lease, Jones leased a Washington D.C. property (the "Property') that was owned by Smith for a period of ten (10) years In 1995, when Jones originally entered into the lease it had not filed its articles of incorporation in any state. However, it represented itself as having been incorporated in New York and Smith relied on that representation. In 1996, Smith realized that Jones was not incorporated but it continued to honor its lease with Jones. Jones finally got around to properly incorporating in New York in 1997. At all times, Jones conducted business as if it were a corporation and it complied with all of the terms of the Smith Lease By 2000, the value of the Property had increased significantly and Smith was looking for a way to get out of its lease with Jones so it could enter into a lease with a higher rent provision. Smith thought back to the 1995 creation of the lease and it recalled that Jones was not incorporated at that time. Smith provided Jones with a notice of termination of the lease and directed Jones to vacate the Property within 90 days stating that the lease was void since Jones did not legally exist at the time it entered into the lease. Jones refused to vacated and maintained that it was entitled to use the property until 2005 under the terms of the lease. Provide an answer to the following questions and be sure to fully explain the reasons for your answer. Be sure to use full sentences and paragraph form in providing your responses. 1. What is a de jure corporation? 2. What is a de facto corporation? 3. What is a corporation by estoppel? We know that Jones wants to keep the lease in place until 20o5. Could Jones use the concept of a de jure corporation to effectively counter the argument of Smith? Why or why not? Could Jones use the concept of a de facto corporation to effectively counter the argument of Smith? Why or why not? 4. 5.Explanation / Answer
De Jure means "a matter of law," indicates that the company has been fully and legally chartered and is therefore entitled to do business. It means company has fully incorporated as per law and recognized as a corporation for all purposes. De facto corporation is a company which operates as if it were a corporation although it is not incorporated. The court treats these companies as corporation as if it were legal in order for providing justice. Corporation by estoppel is the company who operates a business as if it were a limited liability entity or corporation, irrespective of whether there was a good faith effort by the business to incorporate. No, jones cannot use the concept of de jure to effectively argue against smith because at the time of contract jones company was not incorporated. Until & unless company is incorporated it cannot be argued as de jure corporation. No, Jones cannot use the concept of de facto to effectively argue against smith because there must be good faith attempt to comply with statue by the intended incorporator. This is not the case with Jones, he has not tried with good faith to comply with the stature.
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