Thompson & Green Machinery Co. v. Music City Lumber Co

683 S.W.2d 340 (1984)

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Nature of the Case

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Facts

Walker on behalf of Music City and Sawmill (D) purchased a wheel loader. When Walker purchased the unit, Music City was not a corporation. This fact was unknown to Walker and also to Thompson (P) the seller. The actual date of incorporation of D was one day after the sale of the unit. Pursuant to the sale, Walker signed a promissory note in the amount of $37,886.30 on behalf of D to P. D was unable to make payments and returned the unit 8 months later. P then sold the unit for $15,303.83 and applied the proceeds to the note leaving a balance of $17,925.81. P sued to recover the balance due and learned about the fact that D was not a corporation on the day of the contract. P then sued Walker individually under state codes (see middle of page 245 Choper 5th).