Shareholder Liability for Corporate Obligations in Small Business

Artikel

This paper discusses the issue of shareholder liability for corporate obligations in small business. Although the law allows individuals to incorporate their businesses to limit liabilities, the courts have in many cases pierced the corporate veil and held shareholders liable for obligations of the corporation. The doctrine of piercing the corporate veil rarely affects shareholders of publicly-traded firms. In most cases, this doctrine would only reach shareholders of small, closely held firms. While fraud or unjust intent provide reasons for the court to disregard corporate entity, oftentimes the honest but uninformed actions of shareholders are to blame. To maintain limited liability, shareholders of small businesses must act in accordance with die corporate form of ownership in representing the firm, managing the firm’s assets, and financing the firm.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Journal: Journal of Small Business Finance ; ISSN: 1057-2287 ; Volume: 2 ; Year: 1993 ; Issue: 2 ; Pages: 175-182 ; Greenwich, CT: JAI Press

Classification and Topics

• Classification: Management ; Mergers; Acquisitions; Restructuring; Voting; Proxy Contests; Corporate Governance
• Subject: Shareholder Liability ; Small Business

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Nance, Deana ; Vu, Joseph D.
• Event: Veröffentlichung
• (who): JAI Press
• (where): Greenwich, CT
• (when): 1993

Further information

• Handle: http://hdl.handle.net/10419/114654
• Last update: 10.03.2025, 11:43 AM CET