Little Health Law Blog
As a healthcare and business law firm, we have many business entity clients. It is common for business-minded individuals to operate multiple registered companies. When entering business 
contracts, it is easy for the entity name to be mistyped, written in an abbreviated or well-known form, or somehow written incorrectly, especially for those individuals operating many similar entities. There is generally no substantial penalty for such an error, however, it can cause unnecessary trouble should a contract dispute arise, including placing the rights, duties, and liabilities under the contract on the individual who signed as the nonexistent entity. This post intends to alert our business readers of this easily avoidable pitfall and provide an overview of how Georgia courts handle such situations.
To start, the best practice is to sign business contracts using your businesses registered name. To verify the full and correct business name of your entity in Georgia, you can visit Georgia’s Secretary of State website.
If, however, the contract has been signed by an individual purportedly acting on behalf of a nonexistent entity, the general standard is: “[A]n undertaking by an individual in a fictitious name is the obligation of the individual.” Courtland Hotel, LLC v. Salzer, 767 S.E.2d 750, 752 (Ga. Ct. App. 2014). Put another way, if you sign as a fictitious entity, you undertake the responsibilities agreed to by the fictious entity.