The Lowell-Woodward Hardware Company v. G.

R Woods, question the plaintiff's corporate existence, unless upon a
et. al. Partners as the Superior Leasing Company showing that his obligation to make payment would be thereby
Supreme Court of Kansas, 1919. 104 Kan. 729, 180 p. 734 affected.

FACTS The payee was styled in the note, "The Lowell-Woodward
Lowell-Woodward Hardware Company (Plaintiff), describing Hardware Company," a title which prima facie imports a
itself as a Colorado corporation, brought an action against corporation.
several persons alleged to constitute a partnership, upon a
promissory note. Judgment was rendered for the plaintiff. There is some difference of opinion as to whether one
contracting with an organization styling itself a "company,"
On appeal, one of the defendants, Ed. Semke, denied the there being nothing further in the language used to indicate its
plaintiff’s corporate existence, or him being a member of the character, the term "corporation" not being employed, can be
partnership described. heard to deny its corporate capacity when sued by it upon the
contract.
A witness for the plaintiff testified that it was a corporation. He
said that the plaintiff was running a hardware store and that he The defendant, having given his promise to pay the sum
inferred it was a corporation from its name and its mode of indicated to the payee named, should not be permitted to
doing business and that a bank president had told him it was a escape or delay performance by raising an issue as to the
corporation. character of the organization to which he is indebted, unless
his substantial rights might be thereby affected, which would
Apparently, the defendant in this case issued a promissory only be under exceptional conditions.
note in favor of the payee indicated as “The Lowell-Woodward
Hardware Company.” It is thoroughly settled that in such a situation the defendant
cannot attack the regularity of the plaintiff's organization, or
ISSUE take any advantage of the fact that it has no legal standing as a
Whether the defendant can deny the existence of the corporation. No good reason is apparent why, having explicitly
corporation in order to escape his liability from the promissory promised to make payment to the concern by which he is sued,
note. he should be permitted to question its de facto, any more than
its de jure, character--to inject into the case an issue having no
HELD bearing on his obligation to make payment.
No. One who enters into a contract with a party described
therein as a corporation is precluded, in an action brought Defendants were engaged in business as a firm in Colorado
thereon by such party under the same designation, from under “Super Leasing Company” which was signed to the note
denying its corporate existence. sued on and that the appellant was a member of the company.
He also testified that he had been a member until 1912 but had
In accordance with modern views of good practice and to withdrawn from it.
promote substantial justice, the court ruled that one who has
signed a promissory note running to a payee described by a Decision in favor of plaintiff was supported by evidence.
name appropriate to a corporation, although not employing that Judgment is affirmed.
term, cannot, in an action brought against him thereon by such
payee, in which it alleges itself to be a corporation, be heard to