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Piercing the corporate veil: A general overview of the exception creditors can use to find individual shareholders liable for corporate debts

from by David S. Brown, Esquire

From March 6:
A fundamental rule of corporate law is that shareholders, officers and directors are not liable for the debts of the corporation. In this respect, individuals find the corporate form useful because it creates a division between shareholders and their business concerns. Simply put, the corporate form insulates individual shareholders from being held liable for corporate wrongdoings or debts. The Ohio Supreme Court summarized this concept by stating that, "the corporate form has been introduced for the convenience of the company in making contracts, in acquiring property for corporate purposes, in suing and being sued, and to preserve the limited liability of the stockholders, by distinguishing between the corporate debts and property of the company, and of the stockholders in their capacity as individuals." more

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