Court Opinion

ID: 8900979
Source: CourtListenerOpinion
Date Created: 2022-11-27 01:07:23.707483+00
Date Added: 2024-06-11T17:07:50.852715
License: Public Domain

CALABRIA, Judge,
dissenting.
I agree with the majority that the trial court properly dismissed Michael A. Green’s (“Michael”) and Daniel J. Green’s (“Daniel”) (collectively “plaintiffs”) Chapter 75-1.1 claims. However, I find that the trial court erred by denying Corinna W. Freeman’s (“Corinna”) motions for directed verdict and JNOV on the issue of breach of fiduciary duty. I find the trial court also erred by denying Corinna’s motions for directed verdict and JNOV on the issue of extending her liability for corporate obligations beyond the confines of a corporate separate entity by piercing the corporate veil. Therefore, I respectfully dissent.
*674I. Standard of Review
Upon a defendant’s motion for directed verdict, the question “is whether the evidence, considered in the light most favorable to [the] plaintiff, is sufficient to take the case to the jury and to support a verdict for [the] plaintiff.” Barnard v. Rowland, 132 N.C. App. 416, 421, 512 S.E.2d 458, 463 (1999). The motion should be denied “[i]f there is more than a scintilla of evidence to support plaintiff’s prima facie case in all its constituent elements....” Id. (internal quotations and citation omitted). The same standard of review applies to a JNOV motion as to a motion for directed verdict. Id.
II. Fiduciary Duty
I agree with Corinna that the trial court committed reversible error by denying her motions for directed verdict and JNOV on the issue of director/officer liability because plaintiffs failed to adduce evidence of a fiduciary relationship, or evidence that Corinna personally breached any duty to plaintiffs proximately resulting in their harm.
A. Fiduciary Relationship
While normally a jury question, the plaintiff must provide sufficient evidence that a fiduciary relationship exists between the parties. Tin Originals, Inc. v. Colonial Tin Works, Inc., 98 N.C. App. 663, 665-66, 391 S.E.2d 831, 832-33 (1990). “For a breach of fiduciary duty to exist, there must first be a fiduciary relationship between the parties.” Harrold v. Dowd, 149 N.C. App. 777, 783, 561 S.E.2d 914, 919 (2002). In North Carolina, essentially one party has to “figuratively [hold] all the cards” for example, “all the financial power or technical information” to find that “the special circumstance of a fiduciary relationship has arisen.” S.N.R. Mgmt. Corp. v. Danube Partners 141, LLC, 189 N.C. App. 601, 613, 659 S.E.2d 442, 451 (2008).
In North Carolina, “directors of a corporation generally owe a fiduciary duty to the corporation....” Keener Lumber Co. v. Perry, 149 N.C. App. 19, 26, 560 S.E.2d 817, 822 (2002). “[A] director, officer, or agent of a corporation is not, merely by virtue of his office, liable for the torts of the corporation or of other directors, officers, or agents.” Oberlin Capital, L.P. v. Slavin, 147 N.C. App. 52, 57, 554 S.E.2d 840, 845 (2001). However, “an officer of a corporation may be individually liable” for torts “in which he actively participates.” White v. Collins Bldg., Inc., _N.C. App. _, _, 704 S.E.2d 307, 310 (2011) (citation omitted). “A corporation has the officers described in its bylaws or appointed by the board of directors in accordance with *675the bylaws.” N.C. Gen. Stat. § 55-8-40(a) (2011). “Each officer has the authority and duties set forth in the bylaws....” N.C. Gen. Stat. § 55-8-41 (2011).
In the instant case, plaintiffs produced no evidence that Corinna was a director of Piedmont Capital Holding Of NC, Inc. (“PCH”), Piedmont Express Airways, Inc. (“PEA”), and Piedmont Southern Air Freight, Inc. (“PSAF”) (collectively “Piedmont”). The Operating Agreement did not list her, or anyone else, as a director. Jack L. Freeman, Jr. (“Jack”) indicated that Corinna was not a director of the company. Therefore, there is no evidence that Corinna breached her fiduciary duty as a director of Piedmont.
As the majority concludes, plaintiffs presented some evidence from which a reasonable inference could have been drawn that Corinna was an officer of the company. In the Operating Agreement, Corinna was designated as a chairperson of Piedmont. The Operating Agreement indicated that a chairperson was an officer of Piedmont. According to the Operating Agreement, she had the authority and responsibility to organize, conduct, serve as Chair and run meetings of the shareholders or officers. No other duties were listed for Corinna in the Operating Agreement.
However, Michael’s testimony showed that Corinna did not perform any duties as chairperson. .
[Corinna’s counsel]: All right, and there’s two people listed as chairpersons, correct?
[Michael]: Yes.
[Corinna’s counsel]: And Corinna Freeman is listed there, correct?
[Michael]: Correct.
[Corinna’s counsel]: Along with Jack Freeman.
[Michael]: Right.
[Corinna’s counsel]: There was never a meeting where my client ran it on behalf of the companies, was there?
[Michael]: Not that I attended. Not that I remember.
[Corinna’s counsel]: Well, you never received notice of one.
[Michael]: Pardon?
*676[Corinna’s counsel]: You never received notice of a meeting that she called on behalf of the officers or shareholders that allegedly existed, correct?
[Michael]: Yeah, I don’t remember anything like that.
[Corinna’s counsel]: She never did anything pursuant to being the chairperson, correct?
[Michael]: No. She did other things, but not what’s in there.
[Corinna’s counsel]: Well, this gives her position. She’s not listed as having any other position in the company, is she?
[Michael]: No.
Neither stockholders nor directors meetings were ever held nor was stock ever issued. Plaintiffs produced no evidence that Corinna was aware of her role as chairperson of Piedmont. Therefore, plaintiffs failed to show an existence of a fiduciary relationship based on Corinna’s role as a “chairperson” of Piedmont.
Plaintiffs and the majority rely on Corinna’s signature on several documents as “chairperson” and her signature on the January 2005 Wachovia deposit account application as “CEO” to maintain that she had a fiduciary duty to plaintiffs. Plaintiffs produced no evidence that Corinna ever signed any documents as chairperson or “CEO” after plaintiffs’ involvement in November 2005. In addition, the Operating Agreement, signed by plaintiffs, listed Jack as the CEO, therefore, even if Corinna acted as CEO prior to November 2005, after plaintiffs invested and the Operating Agreement was executed her sole role in the company was a designation by the Operating Agreement that she was a chairperson.
The majority also concludes that Corinna had a fiduciary duty to plaintiffs as the majority shareholder. It is well established in North Carolina “that a controlling shareholder owes a fiduciary duty to minority shareholders.” Farndale Co. v. Gibellini, 176 N.C. App. 60, 67, 628 S.E.2d 15, 19 (2006) (citations omitted). “To constitute the defendant a stockholder, it was necessary to show, not only that the stock had been issued, but that it had been actually or constructively accepted by the defendant.” Corp. Comm’n v. Harris, 197 N.C. 202, 203, 148 S.E. 174, 175 (1929). However, the simple fact that the share certificates were never given to the defendant does not conclude that the defendant was not a shareholder. See Marzec v. Nye, 203 N.C. App. 88, 92-3, 690 S.E.2d 537, 541 (2010).
*677In January 2006, Jack increased Corinna’s shareholder interest from 33 units to 88 units, making it appear that she was the majority stockholder in Piedmont. However, there is no evidence she knew of the original issuance of stock or of the increase. No stock certificates were ever issued and Corinna never signed any documents, either the original Operating Agreement or the Amendment that designated her as a shareholder. Since Corinna never knew she was a stockholder, plaintiffs failed to prove that she actually or constructively accepted the stock. Therefore, Corinna did not owe a fiduciary duty to plaintiffs as a majority shareholder.
B. Breach of Fiduciary Duty
Even assuming, arguendo, that a fiduciary duty existed, plaintiffs failed to prove that Corinna breached that duty. Plaintiffs suggest the breach of duty is evidenced because Corinna (1) took funds for her own benefit and (2) failed to stop the corporate waste by Jack and Lawrence J. D’Amelio, III (“D’Amelio”).
Plaintiffs claim Corinna took funds for her own benefit based on several bills that were paid, allegedly on her behalf. These included mortgage payments, Direct TV bills, Northstate Communication bills and utility bills from a house Corinna co-owned located on Burrows Road in Jamestown, North Carolina (“Burrows Road house”). Initially, there were two bank accounts for PEA, an account at First Citizen’s Bank (“PEA account”) and a Wachovia account (“Wachovia account”) that had been set up by Jack’s parents. Jack L. Freeman, Sr. deposited $20,000 in the Wachovia account for Jack and Jack used the account as his own personal checking account. When Jack drew a paycheck, he would deposit it into the Wachovia account. Plaintiffs’ funds were deposited into two separate accounts with First Citizen’s Bank, a money market account and a business checking account. Both accounts were in PCH’s name. The bills from the Burrows Road house were not paid from the PCH accounts at First Citizen’s where plaintiffs’ money was deposited. Furthermore, while Corinna lived in the Burrows Road house at that time and co-owned the house, Jack testified that she had no knowledge of his actions and that he was living there and using those services for his own benefit.
The majority concludes that the evidence supported a reasonable inference that Corinna “knew how her own personal financial obligations were being paid” because “she knew that she herself was not paying them, yet her house was not foreclosed and her utilities were not shut off for nonpayment.” According to the evidence at trial, *678Corinna co-owned the Burrows Road house but Jack lived in the house beginning in 1991 and paid the mortgage payments as rent. Corinna lived in Belmont, North Carolina until November 2004, when she moved back to the Greensboro area and moved in with Jack. Corinna stayed in the Burrows Road house until completion of a handicap accessible house, located on Stafford Oak Drive in Jamestown. The mortgage and utility bills that plaintiffs claim were paid for Corinna’s benefit were payments related to the Burrows Road house where Jack lived and he paid those bills for his own benefit. Since Jack had been paying the mortgage and utilities for a significant period of time, he continued those payments for the Burrows Road house even after Corinna moved in with him. Plaintiffs produced no evidence that Corinna knew Jack was using corporate funds to pay those bills. The majority seems to believe that because the bills were paid, Corinna must have known that Jack used corporate funds to pay those bills. However, plaintiffs produced no evidence of this at trial.
In addition, plaintiffs and the majority claim that Corinna breached her fiduciary duty by failing to stop corporate waste. Yet, there is no evidence that Corinna knew of the waste. Plaintiffs’ witness, Michael, confirmed that Corinna only worked at the office a few times and her work was limited to training employees in the back office. Michael testified that on the few occasions when Corinna came into the office he might have said “Hello” to her, but never discussed any of the company problems with her. David Noble (“Noble”), an attorney at Piedmont between February 2006 and June 2006, indicated that he did everything at Jack’s direction, as did the other company employees. In addition, Noble never observed Corinna working in the offices, there was no indication that she controlled Piedmont, and more importantly, that any actions taken by the company required her authorization. There was no evidence that Corinna actively participated in the management of the office, the assets, or business decisions or had any knowledge about operating Piedmont.
Furthermore, the case law cited by plaintiffs regarding fiduciary duties states the director’s duty is to “administer” the corporation’s property “for the mutual benefit of all parties interested; and, when such directors receive an advantage to themselves not common to all, they are guilty of a plain breach of trust.” Meiselman v. Meiselman, 58 N.C. App. 758, 774, 295 S.E.2d 249, 259 (1982) affirmed in part and modified inpart by, 309 N.C. 279, 307 S.E.2d 551 (1983) (citation omitted). Initially, we note that Meiselman was a case about usurpa*679tion of corporate opportunities, which is not at issue in the instant case. Meiselman v. Meiselman, 309 N.C. 279, 307, 307 S.E.2d 551, 567 (1983).
In addition, there is no evidence that Corinna “administered” plaintiffs’ funds for her benefit. Plaintiffs’ funds were deposited into two separate accounts with First Citizen’s Bank in PCH’s name. D’Amelio transferred funds from PCH’s business checking account into the PEA account. Crystal Byrd, the assistant treasurer, transferred funds from the money market account to the PEA account. There is no evidence that Corinna had access to either PCH account.
While Corinna did have access to the PEA account, the only evidence presented that she removed funds from that account is checks written as “signatory for C. Freeman.” These checks were used to pay a Wachovia credit card bill in Corinna’s name. Jack testified that Corinna helped him to get the credit card and allowed him to use her name because he had gone through a bad divorce and he had to file for bankruptcy. Jack indicated that even though the credit card was listed in Corinna’s name, she never used the credit card and that all the charges on that card were his expenses. The evidence at trial was clear that Jack used the corporate accounts for his benefit, not Corinna’s. When questioned about Corinna’s use of the card, Michael stated that he was “not sure that [they could] prove that or not. You’ll have to ask my lawyer...I don’t know exactly what my attorney’s plan is to do with that information.” Michael also indicated that while he believed people would present information about Corinna’s use of the card, he did not “know any particular exact thing that was hers.” Despite Michael’s claims that his attorney would admit evidence showing Corinna used the credit card, his attorney admitted that there was “no evidence before the [c]ourt right now that [Corinna] used the card....” Plaintiffs failed to show that Corinna breached her fiduciary duty by wrongfully administering plaintiffs’ funds or corporate property. Therefore, I find that the trial court erred in denying Corinna’s motions for directed verdict and JNOV on the issue of breach of fiduciary duty.
III. Piercing the Corporate Veil
I agree with Corinna that plaintiffs failed to adduce evidence that she exercised dominion and control over Piedmont, and therefore she was not the party who caused plaintiffs’ loss.
“[C]ourts will disregard the corporate form or ‘pierce the corporate veil’ and extend liability for corporate obligations beyond the *680confines of a corporation’s separate entity, whenever necessary to prevent fraud or to achieve equity.” Glenn v. Wagner, 313 N.C. 450, 454, 329 S.E.2d 326, 330 (1985). North Carolina uses the “instrumentality rule” which states that “[a] corporation which exercises actual control over another, operating the latter as a mere instrumentality or tool, is liable for the torts of the corporation thus controlled. In such instances, the separate identities of...affiliated corporations may be disregarded.” Id. (citations omitted). The elements necessary to pierce the corporate veil under the instrumentality rule are:
(1) Control, not mere majority or complete stock control, but complete domination, not only of finances, but of policy and business practice in respect to the transaction attacked so that the corporate entity as to this transaction had at the time no separate mind, will or existence of its own; and
(2) Such control must have been used by the defendant to commit fraud or wrong, to perpetrate the violation of a statutory or other positive legal duty, or a dishonest and unjust act in contravention of plaintiff's legal rights; and
(3) The aforesaid control and breach of duty must proximately cause the injury or unjust loss complained of.
Id. at 454-55, 329 S.E.2d at 330. Factors considered in piercing the corporate veil are “[inadequate capitalization ... [n]on-compliance with corporate formalities, [c]omplete domination and control of the corporation so that it has no independent identity,” and “[ejxcessive fragmentation of a single enterprise into separate corporations. Id. at 455, 329 S.E.2d at 330-31 (internal citations omitted).
Complete control and domination over a company is only the first requirement that must be met. In the instant case, plaintiffs contend Corinna exercised control over Piedmont in three ways: (1) she “repeatedly told the world that she was the dominant voice in the business,” (2) she was the principal owner of Piedmont, and (3) she controlled the finances.
The majority contends that in the light most favorable to plaintiffs, the evidence supported piercing the corporate veil in regards to Corinna. However, the evidence indicated that Corinna was not involved with Piedmont at the time of plaintiffs’ investment. Plaintiffs claim that Corinna was the dominant voice of the business yet plaintiffs’ witness, Michael, indicated he never met her prior to his investment:
*681[Corinna’s counsel]: In the 10 to 20 times that you met personally with Jack face-to-face, you never met my client, Corinna Freeman, did you?
[Michael]: No, I didn’t
[Corinna’s counsel]: You never talked to Corinna Freeman in any of the telephone calls that you had with Jack.
[Michael]: No, I didn’t
[Corinna’s counsel]: You never even asked to talk to Corinna Freeman in any of the meetings or telephone calls, did you?
[Michael]: No, I did not.
[Corinna’s counsel]: Corinna Freeman provided no information to you when you were doing this investigation of this investment, did she?
[Michael]: No.
[Corinna’s counsel]: You didn’t ask her to produce any information for you, did you?
[Michael]: No.
[Corinna’s counsel]: She didn’t provide a single document to you, did she?
[Michael]: No; not directly.
[Corinna’s counsel]: She never made any representation to you about this investment at all, did she?
[Michael]: No.
[Corinna’s counsel]: She didn’t make any representation to you as to how the companies would be organized, did she?
[Michael]: No.
[Corinna’s counsel]: She didn’t make any representation to you how they would be run, did she?
[Michael]: No.
[Corinna’s counsel]: She didn’t make any representation as to how your investment would be used, did she?
[Michael]: No.
*682[Corinna’s counsel]: She never told you anything about these companies, did she?
[Michael]: No.
[Corinna’s counsel]: You never asked, did you?
[Michael]: No.
[Corinna’s counsel]: And in these meetings with Jack and [D’Amelio], [Corinna] was never present, was she?
[Michael]: No.
[Corinna’s counsel]: And you didn’t ask for her to be present, did you?
[Michael]: No.
Plaintiffs contend that Corinna’s name on several documents prove that she was the dominant voice of the business. However, the plaintiffs’ evidence only showed that Corinna’s signature appeared on three occasions: 30 November 2001, 20 January 2005 and 20 May 2005. Although the documents listed Corinna as chairperson, CEO or owner, these documents were all signed by Corinna prior to plaintiffs’ involvement. When plaintiffs became lenders for Piedmont, it was composed of PCH, PSAF and PEA. When Jack and D’Amelio created the new venture, they determined that PCH owned 100% of PSAF and PEA, as shown in the Flight Services Requirements Agreement. Therefore, although Corinna was the original owner of PSAF, once Piedmont was created, Jack and D’Amelio’s own company, PCH, owned PSAF. The articles of incorporation creating PCH and PEA were not signed by Corinna. They were both signed by D’Amelio and indicated the incorporators were Jack and D’Amelio. Plaintiffs produced no evidence that Corinna ever represented to plaintiffs that she was an owner/chairperson/CEO. In fact, there was no evidence that Corinna had control over the documents signed after plaintiffs’ investment. Specifically, the 22 November 2005 Loan Agreement and Promissory Notes (which plaintiffs characterized as a loan to Piedmont) in the amount of $400,000, the 22 November 2005 Operating Agreement, the two amended Exhibit Bs to the Operating Agreement, the 22 December 2005 agreement between NAT Group and PCH, and the Exhibit A amendment to the NAT Group agreement.
*683Furthermore, an individual’s mere position as an officer does not prove the requisite amount of domination and control to subject an officer to individual liability when piercing the corporate veil. See Atl. Tobacco Co. v. Honeycutt, 101 N.C. App. 160, 165, 398 S.E.2d 641, 644 (1990) (where the defendant wife believed she was secretary of the companies and her duties included managing the restaurant and ordering goods, the Court found that the plaintiffs failed to show the requisite amount of control to pierce the corporate veil). In the instant case, Corinna’s signature on documents, signed prior to plaintiffs’ loan agreement, failed to show that Corinna had the requisite amount of control to dominate the newly created company, Piedmont.
Plaintiffs also claim that Corinna used her dominance and control to increase her ownership interest. Plaintiffs received and signed an Operating Agreement that listed the ownership percentage of each shareholder. The Operating Agreement indicated Corinna owned 33 units of the company. Corinna never signed the Operating Agreement nor did she ever receive stock certificates evidencing her ownership. Corinna testified in her deposition that she had no knowledge that she was considered a shareholder of Piedmont. Plaintiffs produced no evidence that Corinna was aware of her shareholder status or evidence that stock certificates were issued. In January 2006, two amendments to Exhibit B of the Operating Agreement listed Corinna’s “CAPITAL CONTIBUTION” [sic] as owning 88 units of something. One listed Michael with 10 units and was signed by Michael. The other document listed Daniel with 4 units and was signed by Daniel. Jack testified that without her knowledge or permission, he signed his own name on both documents on the lines above Corinna’s typed name. Jack did not sign “Corinna Freeman by Jack Freeman” but only “by Jack Freeman.” In addition, although Jack signed both documents listing Corinna as owning 88 units, Corinna never received any stock certificate or any type of proof that she owned 88 units. Again, plaintiffs produced no evidence that Corinna was aware that she owned 88 units of Piedmont. In fact, the evidence at trial confirmed that although Jack and Michael knew of the transaction, Corinna was unaware. On cross-examination, at trial, Corinna’s attorney questioned Michael about the fact that Jack signed the document for Corinna:
[Corinna’s counsel]: Okay. So you didn’t get something signed by Corinna, did you?
*684[Michael]: No. When I brought this back to Jack and said, “Jack, this has never — we still haven’t even signed this thing,” he said, “I have — -I can sign for her.”
[Corinna’s counsel]: All right. My question is you never - you still don’t have something signed by her, do you?
[Michael]: Anything signed by her?
[Corinna’s counsel]: This document is not signed by Corinna Freeman, is it?
[Michael]: Correct; no.
[Corinna’s counsel]: You said you wanted something signed by Corinna Freeman, correct?
[Michael]: Correct.
[Corinna’s counsel]: Jack Freeman is not Corinna Freeman, is he?
[Michael]: No.
[Corinna’s counsel]: You didn’t say, “Jack, I want it signed by your mother,” did you?
[Michael]: No.
[Corinna’s counsel]: You didn’t call for a meeting of the shareholders at that time, did you?
[Michael]: No.
Plaintiffs failed to provide a scintilla of evidence that Corinna knew about the 33 units, knew that Jack increased that interest to 88 units, or approved or accepted in the increase. Jack testified that he never asked Corinna’s permission to represent that she had any interest in the company or sought her approval to increase her interest. Jack and D’Amelio misrepresented that the company was a minority company by typing Corinna’s name on the document because they wanted the company to be eligible for government contracts. Since plaintiffs failed to produce evidence that Corinna approved of an interest in the company, agreed to accept an increase, or was even aware of it, the purported transfer of 88 units of non-existing stock without her knowledge or permission does not prove that she exercised control over the company or that she used her control to increase her interest in Piedmont.
*685Finally, plaintiffs and the majority conclude that Corinna controlled the finances because her name appeared on some of the corporate accounts and because she benefitted from corporate funds. Although her name appeared on checks and credit cards, there is no indication that she dominated or controlled corporate funds by using these accounts. The checks “signed” by Corinna prior to June 2006 were signed “signatory for C. Freeman.” Since Corinna’s actual signature does not appear on the checks, the plaintiffs produced no evidence indicating that she signed or had knowledge that the checks were signed without her approval.
The checks Corinna actually wrote from Piedmont accounts were checks that were written in June 2006. There were three checks written to Piedmont employees and the memo section in the comer of the checks indicated that they were written as loans until NAT Group paid. These checks were written from the Wachovia account, not from the First Citizen’s accounts where plaintiffs’ funds were deposited. After the company relocated from D’Amelio’s office to the new office and funds became scarce, Jack paid salaries and rent for the office from the Wachovia account. Corinna wrote all three checks at Jack’s request.
Additionally, the plaintiffs produced no evidence that Corinna orchestrated payments for her bills or had knowledge that Jack used corporate funds to pay her bills. The mortgage and utility bills that plaintiffs claim were paid for Corinna’s benefit were payments related to the Burrows Road house where Jack lived and those bills were paid for his own benefit. Plaintiffs produced no evidence that Corinna knew Jack was using a corporate account to pay those bills.
Corinna stated that she never saw the credit card statements or made payments towards those accounts. In fact, the bills for the two credit cards in Corinna’s name, the American Express credit card and the Wachovia credit card, were sent to Piedmont’s post office box. Plaintiffs failed to show that Jack’s repeated payments for the mortgage and utilities, as well as the use of his mother’s credit cards, were evidence that Corinna exercised dominance and control over Piedmont for purposes of piercing the corporate veil.
Plaintiffs mischaracterize Corinna’s argument concerning the reason she claims no liability under the theory of piercing the corporate veil. Plaintiffs claim Corinna argues that Jack and D’Amelio’s dominance over Piedmont precludes dominance by her. However, Corinna merely states that she simply did not exercise dominance or control *686over Piedmont. Plaintiffs and the majority are correct that factors articulated in Glenn are present in the instant case. Piedmont was undercapitalized, Jack and D’Amelio failed to comply with corporate formalities and excessively fragmented a single enterprise into separate companies. Therefore, it was appropriate that the jury found in favor of plaintiffs on the issue of piercing the corporate veil against Jack and D’Amelio. However, despite plaintiffs’ claim, Corinna did not dominate Piedmont because Corinna did not exercise control over the Piedmont companies. Corinna never dominated or controlled Piedmont. In fact, Michael testified repeatedly that Jack was in control of the company, “it was [Jack’s] way. It was just his company.” Michael also indicated that Jack exercised control over financial decisions and was “in charge of everyone.” Michael did not even claim that Corinna had control, instead indicating again that Jack was in control and that he believed that Corinna signed over control to Jack, but that she did not control Jack.
Piercing the corporate veil as to Corinna would also require that the control and breach of duty must proximately cause the unjust loss. However, since plaintiffs failed to prove Corinna exercised domination and control over Piedmont that would subject her to individual liability, plaintiffs failed to prove her liability for corporate obligations should extend beyond the confines of a corporate separate entity and Corinna’s motions for directed verdict and JNOV on the issue of piercing the corporate veil should have been granted.
IV. Conclusion
I find that the trial court erred by denying Corinna’s motions for directed verdict and JNOV on the issue of breach of fiduciary duty. The trial court also erred by denying Corinna’s motions for directed verdict and JNOV on the issue of extending her liability for corporate obligations beyond the confines of a corporate separate entity by piercing the corporate veil.