Scholz Homes, Inc. v. Lavern E. Larson and Roger E. Kilby

FAIRCHILD, Circuit Judge.

Plaintiff Scholz Homes, Inc., an Ohio corporation, granted a franchise and sold an inventory of materials to Pacific Fabricated Structures, Inc., a California corporation, referred to by the parties as FABSCO, organized by Bernard Perry and Bruce Kilby. The contract was signed August 19, 1960, a few days after incorporation of FABSCO. In 1962 plaintiff Scholz brought this action 1 against Lee (Lavern E.) Larson and Roger Kilby, father of Bruce Kilby.

Larson and Roger Kilby had subscribed for stock in FABSCO before its organization, and plaintiff Scholz alleged that it…