Friday, November 22, 2013

Timberline Equipment Co. v. Davenport case brief

Timberline Equipment Co. v. Davenport case brief summary
514 P.2d 1109 (1973)


CASE SYNOPSIS
Defendant appealed from a Circuit Court, Clackamas County (Oregon) judgment in favor of plaintiff in an action to recover under equipment rental agreements after the court denied defendant's allegations that the rentals were made to a de facto corporation and that plaintiff was estopped from denying the organization's corporate character.

CASE FACTS
Plaintiff filed suit against defendant to collect monies due under an equipment rental agreement. Defendant alleged that the rentals were made to a de facto corporation and accordingly he could not be held personally liable and that plaintiff was estopped from denying the corporate character of the lessee organization. The trial court rejected defendant's argument and entered judgment in favor of plaintiff. The appellate court affirmed, holding that the de facto doctrine no longer existed in the state.

DISCUSSION

  • The court also held that doctrine of estoppel was inapplicable because there was no evidence that plaintiff believed that it was contracting with a corporate entity. 
  • Further, the court held that plaintiff could recover against defendant in his individual capacity because evidence indicated that defendant was a person who was assumed to act for the organization in question and accordingly could be held personally liable.

CONCLUSION
Appellate court affirmed and held that the de facto doctrine no longer existed under state law and that estoppel was inapplicable because nothing indicated plaintiff believed it was dealing with a corporation. Defendant was held individually liable under the rental agreements because he was assumed to act for the organization.


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