noting that the defendant corporation “regularly ignored corporate formalities and that the line between the corporation and at least some of the shareholders was Very blurry’ ” but finding that “[disregard of corporate formalities alone is not ... sufficient to justify piercing” but that “fraud, illegality or injustice need be shown”
How later courts described this case
- noting that the defendant corporation “regularly ignored corporate formalities and that the line between the corporation and at least some of the shareholders was Very blurry’ ” but finding that “[disregard of corporate formalities alone is not ... sufficient to justify piercing” but that “fraud, illegality or injustice need be shown”
- reasoning that disregard of formalities blurred the distinction between the corporation and its shareholders
- “Although it is clear that the corporate form may be disregarded to prevent injustice and to reach an equitable result, we believe that the injustice sought to be prevented must in some manner relate to a misuse of the corporate form short of fraud or illegality.”
- “Where the corporation is a mere agent or instrumentality of its shareholders or a device to avoid legal obligations, the corporate entity may be ignored.”
Written by the judges who cited it.
The opinion
Beasley, J.
(concurring in part; dissenting in part). I join with the majority in reversing the judgment against defendants Ivan A. MacArthur and Claude O. Darby, Jr.
I would, however, affirm the judgment against defendant Western Hills Development Company. While the evidence certainly was not overwhelming, I would hold that there was enough evidence to support the trial judge’s findings in this nonjury trial.