King v. Modern Music Co.

STUBBLEFIELD, P.J.,

dissenting

T1 I respectfully dissent. I believe reasonable inferences from the evidentiary materials in the record support the conclusion that Larry K. Phillips, individually, and perhaps acting in his capacity as officer of Modern Music Company, was using the corporate entity, F & J Venture, Inc., as a shell by which he could ensconce a series of lessees as operators of the establishment which, at one time, was known as the Double Eagle Club. The evidentiary materials support the conclusion that Phillips negotiated with June Allison to become the lessee/operator, and that she took initial action to create F & J. Her testimony was that she never "activated" the corporation, and that Phillips must have been the person that did finalize creation of the corporate entity without her knowledge.

I 2 I believe this case cannot be addressed merely as one involving dram shop liability. Plaintiffs have a judgment against F & J Venture, Inc. and, thus, that entity's liability for Plaintiffs' damages has been determined. This action was brought to pierce the corporate veil and assign liability to Phillips. Although Phillips was not a named owner or officer of F & J, the evidentiary materials indicate that he may have used the corporation shell for his own purposes. While the general rule is that a corporation is a separate legal entity, that legal fiction may be disregarded if the corporate existence is a fraud or scheme used as an instrumentality or adjunct of another. Oklahoma Oil & Gas Exploration Drilling Program 1983-A v. W.M.A. Corp., 1994 OK CIV APP 11, ¶ 8 , 877 P.2d 605, 609 . The , evidentiary materials support the conclusion that the corporation, F & J Venture, Inc., was such an instrumentality of Phillips. I believe that fact, if established at trial, would support assignment of liability to Phillips, and possibly to Modern, for the judgment rendered against F & J. I would reverse and remand.