Law122 Ethics Assigment
Law Ethical Reasoning Assignment
Tal Braiman
500554050
496 Words excluding Footnotes
Wally is the sole shareholder and director of multiple corporations that he created. He structured his businesses in a way to minimize his liability and risk. Unfortunately, Wally has caused an error which ended up destroying his client’s whole house. He admitted liability for this error through his corporation which was hired, Wally’s Electrical Services. His client had an insurer (BIC) which covered the damages, but they are now coming after Wally’s Electrical Services to recover the damages. Unfortunately for the insurer (BIC), they has very limited assets, and do not own most of the equipment, since they lease it from another one of Wally’s corporations (Wally’s Construction Equipment ltd).
Legally speaking, Wally has created him multiple corporations in a way to minimize risk and liability. This way, the corporation (not shareholder) incurs the liability. Wally himself has limited liability as a shareholder, and has no direct liability for any obligations of the corporation. The only exception to this happens very rarely, and is only activated if there is serious fraud, unfairness, or wrongdoing. Due to this, there is a small chance that the court would recognize the wrongdoing and unfairness in this situation. BIC can only sue Wally for the assets that are owned under his corporation of Wally’s Electrical Services. This corporation does not own any equipment or assets, so BIC will not have access to much. Even though Wally personally has much more assets, this is not accessible by BIC or any creditor because he is just a shareholder/director.
Ethically speaking, I believe that BIC should be able to sue Wally directly, and access his assets that he owns through his many corporations. Although Wally has set up multiple different corporations for protection, Wally is the sole shareholder and director of all his corporations. He was directly responsible for a huge amount
Tal Braiman
500554050
496 Words excluding Footnotes
Wally is the sole shareholder and director of multiple corporations that he created. He structured his businesses in a way to minimize his liability and risk. Unfortunately, Wally has caused an error which ended up destroying his client’s whole house. He admitted liability for this error through his corporation which was hired, Wally’s Electrical Services. His client had an insurer (BIC) which covered the damages, but they are now coming after Wally’s Electrical Services to recover the damages. Unfortunately for the insurer (BIC), they has very limited assets, and do not own most of the equipment, since they lease it from another one of Wally’s corporations (Wally’s Construction Equipment ltd).
Legally speaking, Wally has created him multiple corporations in a way to minimize risk and liability. This way, the corporation (not shareholder) incurs the liability. Wally himself has limited liability as a shareholder, and has no direct liability for any obligations of the corporation. The only exception to this happens very rarely, and is only activated if there is serious fraud, unfairness, or wrongdoing. Due to this, there is a small chance that the court would recognize the wrongdoing and unfairness in this situation. BIC can only sue Wally for the assets that are owned under his corporation of Wally’s Electrical Services. This corporation does not own any equipment or assets, so BIC will not have access to much. Even though Wally personally has much more assets, this is not accessible by BIC or any creditor because he is just a shareholder/director.
Ethically speaking, I believe that BIC should be able to sue Wally directly, and access his assets that he owns through his many corporations. Although Wally has set up multiple different corporations for protection, Wally is the sole shareholder and director of all his corporations. He was directly responsible for a huge amount