
    ANNA SHERWIN, DEFENDANT IN ERROR, v. LAZAR STERNBERG AND ROSE STERNBERG, PLAINTIFFS IN ERROR.
    Argued June 4, 1908
    Decided November 9, 1908.
    Defendants entered into a written agreement with plaintiff wherein they agreed to incorporate as L. Sternberg & Company, upon the strength of which plaintiff contributed $1,500 to defendants. The corporation was never formed, and in a suit by plaintiff to recover the amount paid—Held, that the consideration having failed the defendants were liable under the agreement as joint contractors in an action of assumpsit.
    
    On error.
    Before Gummere, Chief Justice, and Justices TreNCH-ard and MiNturN.
    For the defendant in error, Arthur T. Dear and George G. Tennant.
    
    For the plaintiff in error, Frank E. Bradner.
    
   The opinion of the court was delivered by

Minturn, J.

The plaintiff and defendants entered into a written contract whereby they agreed within five days from the date thereof that the defendants would form a corporation to be known as L. Sternberg & Company, in pursuance of which the plaintiff contributed to the defendants, one of whom at least at that time was conducting a department store business in Jersey City, the sum of $1,500, for which the plaintiff was to receive stock and a position in the business.

The defendants failed to form the corporation within the time limited, or at all, and the plaintiff brought suit upon the common counts to recover the amount paid. The trial court directed a verdict upon this testimony for the plaintiff, and this writ of error is intended to review the correctness of that direction. The testimony demonstrated that the defendants received the money; that an effort was made to incorporate, but that the secretary of state refused to allow the incorporating papers to be filed because of a similarity of title to that of an existing corporation. Defendants’ contention that the filing of the incorporation certificate with the county clerk resulted in the formation of at least a de facto corporation is without merit, for the reason that the plaintiff’s agreement was to contribute to the formation of a de jure corporation. Furthermore, that question was not raised by exception at the trial and it cannot, therefore, be noticed here. Associates v. Davison, 5 Dutcher 415; Potts v. Evans, 29 Vroom 384.

The contention that the defendant Rose Sternberg occupied the status only of a surety is erroneous. Her status was fixed by the agreement in evidence in which she acknowledged herself to be a "party of the first part,” and further acknowledged that the plaintiff had contributed $1,500 for the purpose of the incorporation, "the receipt whereof is hereby acknowledged by the said parties of the first part.” She is therefore es-topped from denying that she had an interest in the business or that she was benefited by the payment. 16 Cyc. 679, and cases; State Bank v. Chetwood, 3 Halst. 1; 2 Rice Evid. 708.

The facts proved make it clear, as a matter of law, that under the terms of the agreement the defendants were liable as joint contractors, and, upon the well-settled principles applicable to that status, they became liable in an action of assumpsit, upon failure of the consideration expressed in the agreement, to repay to the plaintiff the money advanced by her as quid pro quo for the performance of the defendants’ agreement. 4 Cyc. 229, and cases; 1 Chit. Pl. 99; 1 Pars. Cont. 22; Alpaugh v. Wood, 24 Vroom 638; Cory v. Freeholders of Somerset, 18 Id. 181; National Trust Co. v. Gleason, 77 N. Y. 400.

Entertaining this view of the case, we find the remaining assignments of error without merit, and conclude that the judgment should be affirmed.  