Opinion ID: 2822139
Heading Depth: 1
Heading Rank: 1

Heading: introduction

Text: The State seeks to hold the sole shareholder, director, and employee of a closely held Washington corporation personally liable for the corporation’s unpaid tax debts. The superior court pierced the corporation’s corporate veil, ruled that the shareholder’s successor corporation was liable for the tax debt, voided two contract transfers as fraudulent conveyances, and ruled that the shareholder had breached fiduciary duties to the corporation and the State as the corporation’s creditor. The shareholder and corporation appeal the superior court’s decision to pierce the corporate veil, arguing that the superior court erred by not barring the State’s suit under the principle of res judicata, by applying Alaska rather than Washington veil-piercing law, and by making clear factual errors. The shareholder and corporation also appeal the superior court’s finding that two contracts were fraudulently conveyed. We conclude that res judicata does not bar the State from seeking to pierce the corporation’s corporate veil to collect a corporate tax debt established in an earlier case. We further conclude that the corporation’s corporate veil was properly pierced under both Alaska and Washington law. And although the superior court’s fraudulent conveyance determination contained errors of fact, they are unlikely to affect the relief the State seeks. We therefore affirm the superior court’s decision in part, reverse it in part, and remand for further proceedings only to the extent necessary.