4 ms·

Undercapitalization in the absence of liability insurance could be grounds for piercing the corporate veil.

• tptacek 13y ago
  It can? Has that actually happened (in the UK or US), or been argued, ever? Can you cite a source?
  • nknighthb 13y ago
    Vuylsteke v. Broan, Minton v. Cavaney, State v. Weinschenk, Anderson v. Abbott.
    • tptacek 13y ago
      Sorry, I was imprecise. I understand that it is possible to collect damages from controlling shareholders of corporations; for instance, in any tort case; in several states, unpaid wages also incur liability on company owners, as they did in Vuylsteke. I was asking specifically about your liability insurance argument.
      • nknighthb 13y ago
        You mean that insurance can count in determining adequate capitalization? The cases I can find that are most on point is Walkovszky v. Carlton, where a claim of underinsurance was directly at issue (unsuccessful because the insurance that was carried met an explicit statutory requirement) and Autrey v. 22 Texas Services Inc. (on a summary judgement motion finding there are facts in dispute, so not squarely ruled on). A couple of relevant papers that discuss insurance throughout: http://scholarship.kentlaw.iit.edu/cgi/viewcontent.cgi?article=2470&context=cklawreview http://scholarship.kentlaw.iit.edu/cgi/viewcontent.cgi?artic... http://www.law.emory.edu/fileadmin/journals/elj/56/5/Millon.pdf http://www.law.emory.edu/fileadmin/journals/elj/56/5/Millon....