Byron Cabell forms a corporation named Cabell, Inc., following all the proper legal formalities in the formation process. Cabell fails, however, to keep corporate records. Finally, he does not separate his business property from his personal property. If a creditor discovers the poor financial status of Cabell, Inc., and decides to sue Cabell as an individual, will the creditor succeed? What theory will the creditor use to hold Cabell personally liable?
Probably will succeed. Corporations are protected as long a a veil is kept between personal and corporate finances. Once that is broken, there is no protection.
