## Facts

- A Wisconsin clothing supplier sold children’s clothing to a UK business that traded as “Dan Marbel Inc Limited.”
- The UK company had originally been incorporated as “Egormite Ltd” and had resolved to change its name, but the official certificate making the name change legally effective was not issued until years later.
- During the supply period, trading documents used “Dan Marbel Inc” while also showing Egormite’s company registration number, without clearly stating that “Dan Marbel” was merely a trading name for Egormite.
- Edward Lewis Craze controlled the company’s operations and served as the supplier’s main contact.
- The supplier sued for the unpaid price, obtaining default judgment against both the company named in the writ and Craze personally.
- The default judgment was later set aside against the company but left standing against Craze; Craze appealed further.

## Issues

1. Whether the supply contracts were with the existing incorporated company (Egormite Ltd) despite the use of the not-yet-effective name “Dan Marbel Inc Limited,” or instead with a non-existent entity.
2. If the contracts were treated as made with a non-existent principal, whether Craze incurred personal liability under applicable statutory provisions concerning misstatement of corporate name or acting for a company not duly formed, or at common law as an agent for a non-existent principal.
3. Whether the default judgment against Craze should be set aside.

## Decision

- The Court of Appeal allowed Craze’s appeal and set aside the default judgment against him.
- The court treated the transactions as contracts with the existing company (Egormite Ltd), misdescribed in the paperwork by the trading/intended name “Dan Marbel Inc Limited.”
- Because a real corporation existed behind the trading name, the case was not treated as a true pre-incorporation contract situation warranting personal liability of the individual dealing for a non-existent principal.
- On the evidence and statutory construction, Craze was not personally liable under the relevant “misdescription of company name” provisions or under provisions aimed at persons purporting to act for an unformed/unregistered company.

## Legal Principles

- A change of corporate name does not create a new legal person; the company remains the same entity with the same rights and liabilities.
- A contract made with an existing company is not converted into a contract with a non-existent principal merely because the company is misnamed or described by an intended or trading name.
- Personal liability for using an incorrect corporate name depends on the specific statutory conditions (including who signed the relevant business documents and in what capacity) and is not imposed automatically from misdescription alone.
- Statutory rules imposing liability for acting for a company not duly formed generally target dealings for a truly non-existent company; they do not apply where the company exists but is inaccurately named.

## Conclusion

The Court of Appeal held the debts arose from contracts with the existing incorporated company despite misdescription of its name, and it set aside the default judgment against the controlling individual because the facts and statutes did not justify treating him as personally liable for acting for a non-existent principal.


Oshkosh B’Gosh, Inc. v. Dan Marbel Inc. Ltd, [1988] 3 C.M.L.R. 214 (Eng. C.A. 1988)