John A. Goodman was a real estate salesman in the state of Washington. Goodman sold to Darden, Doman & Stafford associates (DDS), a general partnership, an apartment building that needed extensive renovation. Goodman represented that he personally had experience in renovation work. During the course of negotiations on a renovation contract, Goodman informed the managing partner of DDS that he would be forming a corporation to do the work. A contract was executed in August between DDS and “Building Design and Development (In Formation), John A. Goodman, President.” The contract required the renovation work to be completed by October 15. Goodman immediately subcontracted the work, but the renovation was not completed on time. DDS also found that the work that was completed was of poor quality. Goodman did not file the articles of incorporation for his new corporation until November 1. The partners of DDS sued Goodman to hold him liable for the renovation contacts. Goodman denied personal liability. Was it ethical for Goodman to deny liability? Is Goodman personally liable? Goodman v. Darden, Doman & Stafford Associates, 670 R2d 648, 1983 Wash. Lexis 1776 (Supreme Court of Washington).
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