BA - Piercing the Corporate Veil

Improperly formed corporations: Agents / Owners may be held liable

Agents Agents purporting to act on behalf of the nonexistent entity will beheld liable unless properly signed and phrased K to limit agent authority Owners Owners will be held liable UNLESS 1. Corp de Jure 2. Corp de Facto 3. Corp by Estopple

PCV Rule

Ct may hold the Owners of a properly formed Corp liable for the Corp's debts using factors: Unity of Interest -Corp formalities are disregarded -SH dominates finances, business practices, etc. Fraud / Injustice a. Corp was used to commit a fraud or injustice (Undercapitalization is a consideration)

Corp Liability - General Rule:

SHs are not liable for the debts and obligations of a corporation. Exceptions: 1. SH gives personal guarantee 2. Improperly formed corporations 3. Court pierces the corporate veil

SH gives personal guarantee

When a SH signs off that they will pay if the Corp. does not