Quest Engineering Solutions, Inc. v. Wilbur

2011 WL 2224953 (2011)

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Quest Engineering Solutions, Inc. v. Wilbur

Massachusetts Appeals Court
2011 WL 2224953 (2011)

  • Written by Rose VanHofwegen, JD

Facts

Quest Engineering Solutions, Inc. (plaintiff) sued seeking to hold Eric Wilbur (defendant) personally liable for breach of a contract that he signed before forming Compliance Management Group Corporation (CMG). Wilbur signed only his name instead of signing in a representative capacity or on behalf of CMG, even though he planned to form CMG and had already selected the name. The contract said it was anticipated that Wilbur would “form a corporation to undertake his obligations” but otherwise did not mention CMG. The contract stated it was an interim agreement terminable by either party on short notice, but the parties did not execute a replacement agreement reflecting CMG had been formed, adopted the preincorporation contract, and assumed contractual obligations until over two years later. In addition, Wilbur never obtained a release from liability. At a bench trial, Quest’s president, who signed the agreement on Quest’s behalf, testified that he always looked to Wilbur to perform the contract and not solely CMG, even after its formation. The judge ruled that Wilbur signed the preincorporation agreement as CMG’s promoter, meaning a person who forms a corporation, making him personally liable for over $165,000 for breaching the noncompete provision by competing with Quest. Wilbur appealed.

Rule of Law

Issue

Holding and Reasoning (Per curiam)

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