Suppose you sue a corporation or a limited liability company and win, but the defendant has no money to pay your award and no other assets you can execute against. Is that a factor that justifies piercing the veil to make the owners of the company pay your award? The Indiana Court of Appeals answered that question, and a couple of others related to veil piercing, in Country Contractors, Inc. v. A Westside Storage of Indianapolis, Inc.
Country Contractors was incorporated in 1983 as a seller of ready-mix concrete under the name Country Concrete, Inc. In the 1990’s the company expanded its business to include construction work and excavation. Over the years, Country Contractors owned a substantial amount of assets in the form of construction equipment that it leased to other contractors. In 2007 the corporation changed its name to Country Contractors, Inc. and amended its articles of incorporation to better reflect its expanded line of business. Its two shareholders served as the board of directors, but three other people were responsible for running the company from day to day — preparing bids, executing contracts, and supervising the work.
In 2007, Westside engaged Country Contractors to perform excavation and construction services for the price of $235,000. Country Contractors subcontracted much of the work, which began in 2008. The two owners were not involved in the negotiation or execution of the contract, nor did they supervise the work.