receives a final judgment for money damages (2) ABC Corp. Consider the following: (1) Creditor of ABC Corp. In a majority of cases, the claimant is seeking to pierce the corporate veil because of the wrongdoing of the company or its owners. Of all of the factors that courts look at, the existence of fraud, wrongdoing, or injustice is the biggest red flag when determining whether or not to pierce the corporate veil.
Courts in Florida have enumerated a number of factors that may lead to piercing the corporate veil. Under Florida law, a party wishing to pierce the corporate veil must show that the corporation at issue is the mere instrumentality or alter ego of its shareholder(s) or its parent corporation, and that said shareholder or parent corporation engaged in improper conduct. Think of it this way – the corporate structure is the “veil” that provides protection and if that veil is pierced, there is no more protection. This personal liability opens owners, shareholders, or members bank accounts, real and personal property interests, and investments to risk. Piercing the corporate veil is the legal jargon used to describe an action pursued against a company that ultimately leads to personal liability of the owners, shareholders, or members wherein the corporate structure is disregarded. This blog post will discuss the five most common ways to pierce the corporate veil and shatter the façade of protection that the entity creates.īefore discussing the most important factors of veil piercing, it is important to understand what it means to pierce the corporate veil. Many of you have heard of the term “pierce the corporate veil” but haven’t thought any more about it. However, the mere shell of a corporate structure is not always enough to avoid personal liability. The business maintains a separate and distinct identity from that of its owners or related entities. Many entrepreneurs create business entities to operate their businesses, to facilitate commercial ventures, and to shield themselves from personal liability.
#Just the way you are pierce the veil professional#
Basic Fiduciary Duties Owed in Florida Professional Service Provider Companies.Can Professional Service Providers Enforce Non-Competes Based on Protection of Goodwill?.Part I: What Documents Matter Most In Determining Share Value in a Buyout? An Analysis of Key Documents and Why They Matter.Part II: What Documents Matter Most In Determining Share Value in a Buyout? An Analysis of Key Documents and Why They Matter.Part III: What Documents Matter Most In Determining Share Value in a Buyout? An Analysis of Key Documents and Why They Matter.Other Articles in Professional Services Industry Legal Blog If you are interested in speaking to a Jimerson Birr lawyer or want general information about the firm, our practice areas, lawyers, publications, or events, please contact us via email or telephone for assistance at (904) 389-0050. Jimerson Birr welcomes inquiries from the media and do our best to respond to deadlines. Real Estate Development, Sales & Leasing.Community Advocacy & Social Responsibility.Search Website Submit SearchSearch Close Search
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