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Perpetual Real Estate Services, Inc. v. Michaelson Properties, Inc. 974 F.2d 545 (4th Cir. 1992), [1] is a US corporate law case, concerning piercing the corporate veil. Facts [ edit ]
Piercing the corporate veil or lifting the corporate veil is a legal decision to treat the rights or duties of a corporation as the rights or liabilities of its shareholders. Usually a corporation is treated as a separate legal person , which is solely responsible for the debts it incurs and the sole beneficiary of the credit it is owed.
Commingling is also evidence that may be used in "piercing the corporate veil" of a sham corporation, where a person shields himself from personal liability through "incorporation", yet fails to observe strict separation of corporate and personal property or accounts, among other improprieties.
De facto corporation and corporation by estoppel are both terms that are used by courts in most common law jurisdictions to describe circumstances in which a business organization that has failed to become a de jure corporation (a corporation by law) will nonetheless be treated as a corporation, thereby shielding shareholders from liability.
This is referred to as piercing the corporate veil, and is subject to the rules of the home state where the corporation is a domestic corporation. In the case of corporations domesticated in Nevada, for example, as of 2007 [update] , over the last twenty years, only twice has the corporate veil been pierced, and in both cases the corporation's ...
This leaves the question of the nature of the common law, in absence of a specific statute, or where a state law forbids piercing the veil except on very limited grounds. [62] One possibility is that tort victims go uncompensated, even while a parent corporation is solvent and has insurance.
Real estate agent Mark Hawkins of Long Beach, Calif., says that many home sellers, especially those with expensive homes, don't understand why an agent should be paid more for selling a $1 million ...
Nevada law provides extremely strong protection against piercing the corporate veil, where a corporation's owners can be held responsible for the actions of a corporation. For instance, from 1987 to 2007, there was only one case that successfully pierced the corporate veil of a Nevada corporation, and in this case the veil was pierced due to ...