Cutting edge fashion for young affluent clientele

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Gianella plans to open a boutique on Main Street where she will offer the latest in cutting edge fashion for a young affluent clientele. Gianelli hires Tessa to handle various business matters for the boutique, including obtaining a lease and arranging financing. Tessa signs a 36 month lease Windows on Main Street. Tessa signed the lease on behalf of "Ultra Fashion, Inc.", the name of Gianelli's company. Ultra Fashion, Inc, is not doing well and does not pay the rent. When Ultra Fashion, Inc. goes out of business, Windows on Main Street demands that Tessa pay the unpaid rent. Ultra Fashion, Inc. was not incorporated until 6 days after the Tessa signed the lease with Windows on Main Street. But, after incorporation, Ultra Fashion, Inc. ratified the lease with Windows on Main Street. Explain the legal rights each of the parties has to each other.

Reference no: EM133297788

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