Question

Assume that Laverne and Shirley prepare articles of incorporation but forget to send the articles to the appropriate state office. A few months after they begin to operate their consulting business as a corporation, Laverne visits a client. After her meeting, in driving out of a parking lot, Laverne inadvertently backs her car over the client, causing serious bodily harm. Is Shirley liable for the accident? Why?

Answer 1

No, Shirley is not liable for the accident.

Step-by-step explanation:

Articles of incorporation is necessary for the legal recognition of a firm as it includes the documents and papers under state government.

This article includes data such as name of the firm, address, stock type, etc. Thus in case of Laverne and Shirley, although both of them had articles of incorporation prepared, but they were not able to send those to the state office discarding it from the legal point of view.

Thus the failure of the state approval did not hold Laverne and Shirley as legal partners are and hence there won't be any liability of the accident on Shirley and only Laverne would be liable.