Legal Question in Business Law in Minnesota

Can they pierce the C-Corp Veil?

Husband & I Pres/VPres 10 yr old C-corp Constr.Co. Spring 2001:husband-cancer/lost eyesite/disabled. During illness, employees not able to continue operations. I not an employee, husband was. Fall 2001: assets sold/not enough

No Dissolution done.

Mn.supplier taking us to court. (Defendants: G. Jones and J.Jones, dba Ccorp Name, Inc.) Can't afford attorney/I answered Inform.Stmt, Interrog., Request for Admissions & Request for Production of Documents. Court Called/mailed back documents & Needs $250 for:Answer/First Pages and Answer to Complaint.

Bookeeper of corporation filled out credit app. under ''Business Information'' that the company was a ''Corporation'', but listed us officers under section noted ''Individual/Partnership'' instead of ''corporation'' section listing officers/date of incorporation. She signed application. Bookkeeper-seriously ill/not able to give a statement.

Teleconference 12/9/03

Don't have $250/asking for continuance.

If I do nothing, can a judgement be put against my husband and me as officers of this corporation?


Asked on 12/03/03, 11:36 am

2 Answers from Attorneys
Vincent W. King Vincent W. King, PA

Re: Can they pierce the C-Corp Veil?

I'm so sorry for you; sounds like you are having a rough time.

It's hard to answer your question without seeing the documents and seeing whether the corporation was kept in good standing during the applicable time period.

Generally, if the corporation was in good standing a mistake in describing you & your husband as "partners" rather than "officers" will not allow the creditor to pierce the veil. Unfortunately, you have to be able to present this info to the judge, which is hard to do if they won't let you file anything if you can't pay the fee.

Minnesota statutes allow people to proceed "in forma pauperis" if they can't pay the filing fees and so forth. You can find a link to the applicable statute here: http://www.revisor.leg.state.mn.us/stats/563/01.html

Also, if you check with the court clerk, s/he may be able to help you with the affidavit.

Note, in forma pauperis won't allow the corporation to answer; only you & your husband as individuals. But, based on the facts, it seems as though you would be willing to accept a judgment against the corporation.

Standard disclaimer: This is not legal advice and we do not have an attorney-client relationship. The comments above are based on the limited information given in the question, and the comments could change based on additional facts.

Finally, and I am not sure about this, your local legal aid society may be able to provide you with some help.

That said, good luck to you and I hope things will go better for you!

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Answered on 12/03/03, 12:07 pm
David Kelly-952-544-6356 Kelly Law Office

Re: Can they pierce the C-Corp Veil?

A way to do an end run around all of this stuff is to file a Chapter 7 bankruptcy. If things are as bad as you describe, that might be the answer.

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Answered on 12/03/03, 6:13 pm


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