P.S. I've already had this arguement with muska in a different thread. He claims to be a lawyer and, while he initially said the same thing, when I explained my buddy's case, he later admitted it can happen in a personal injury case.
Here I am, still shamelessly claiming to be a lawyer. For anyone who would like to tune in on that previous thread where JAG thoroughly kicked my butt, forcing me to "later admit" that he was right, here it is:
http://canadianmoneyforum.com/showthread.php/106618-Holding-Company-Now-or-Later
I have gone back and re-read that thread. Call it wilful blindness, but I cannot see that I admitted much apart from saying that some circumstances can be imagined where a corporate principal can be held liable in a personal injury case. I never said otherwise. These things are always fact-driven and possible scenarios are endless. But I remain firmly of the view that the concept of the limited liability corporation remains alive and well and it can offer protection against all manner of personal liability.
It is also the case that I remain of the view that JAG is dead wrong when he says
the plaintiff's lawyer will go down to corporate records and pull the owners and directors of the company they are suing. They will then list the owners and directors as part of their lawsuit.
First off, going off to the company registry should be a job for an articled student. A lawyer's time is too valuable to be wasted on registry searches. Anyway, it's all available to lawyers online these days. As I said before:
True, in some tort cases, where it is not clear at first blush where fault lies, some "shotgun" pleading might be called for. But the notion of keeping in the action to the end of trial every possible defendant is not a course responsible counsel would undertake. It will greatly protract the proceedings, drive up costs and, in the end, someone must bear those costs. I would not want to be the one explaining to my client just why it is that he is on the hook for the costs of a conga line of successful defendants. Moreover, if the court finds the action should never have been brought or maintained against some defendants, the award of costs might be punitive indeed, such as an award of "special costs" or "solicitor client" costs, etc.
Again, I'll support my views with a few cases. Below I offer a few B.C. case citations. Each follows a line or two stating what may be drawn from the case as far as corporate principal liability goes and how often corporate principals are or are not sued. JAG says it's always. I say BS. JAG also says where there is insurance, the plaintiff always wins. Nonsense.
1. Occupiers' liability, franchise restaurant, franchisee and franchisor companies sued; no personal defendants sued.
http://www.courts.gov.bc.ca/jdb-txt/sc/15/23/2015BCSC2310.htm
2. Personal injury action against small hotel owner. No personal defendants sued. Action dismissed even though we can be pretty sure there was insurance.
http://www.courts.gov.bc.ca/jdb-txt/sc/17/02/2017BCSC0274.htm
3. Personal injury action against small bakery. Only the company sued. Defendant company found 25% at fault at trial. On appeal, court finding clumsy plaintiff wholly at fault. No liability found against company, even though insurance was likely in place.
http://www.courts.gov.bc.ca/jdb-txt/SC/13/08/2013BCSC0889.htm
4. Personal injury action against corporate owner of a small commercial building rented to tenants. Principals of the company not sued but one “personal defendant” was sued because she was a tenant of the premises, operating a business as a proprietor, not using a corporation. On plaintiff’s appeal, court finding landowner not an “occupier” under Occupiers Liability Act, s. 1(b), and agreeing tenant was not negligent. Action dismissed even though there was most likely insurance in the background.
http://www.courts.gov.bc.ca/jdb-txt/CA/12/01/2012BCCA0108.htm
5. Next comes a personal injury case against a company operating a beauty shop. Again, company owners/directors/shareholders/ friends and relatives of same were not sued. However, the shop employee said to have been at fault was sued. This is normal in personal injury litigation. Where an individual is identified as being the causative agent, it is prudent to name them as defendant, on the principle that a tortfeasor is always liable for his own tort.
http://www.courts.gov.bc.ca/jdb-txt/SC/11/16/2011BCSC1690.htm
That could well apply to JAG’s buddy for all we know. There might be facts that suggest personal fault on his part.
6. Next is an unsuccessful personal injury action against Canada Safeway. I’ll bet Safeway carries insurance, so why did the trial judge not nail them? Why did the appeal court uphold the trial judge? Imbeciles! On top of that, why did the plaintiff's lawyer not run down to the registry (even if living in a different town from said registry...always fun to bill for travel) and do a company search and sue officers and directors, etc. of Safeway?
http://www.courts.gov.bc.ca/jdb-txt/CA/11/02/2011BCCA0202.htm
Oh, now I remember. JAG gave me a stern rebuke in the previous thread for mentioning a suit against the principals of Walmart:
Mukhang,
First off don't compare a Walmart shareholder to a single guy, who owns a company and is also the sole (or co-owner with family) the two are not the same by any means.
So it must be that when a corporation gets to be of a certain size or notoriety, that its principals gain shelter from personal injury lawsuits. I would ask JAG to expound in this thread at just where that point of non-liability begins. What size company? Size determined by # of shareholders, gross revenues, or what exactly?
I must also remember that JAG is able to draw on the considerable legal training he has received as a result of talking to his friend. I, on the other hand, am not talking of real word events. As JAG says:
You may be up on what's happening on the theory, but I'm watching it happen in real life.
So the court decisions I have cited, do not involve real lawsuits against real people. They are theoretical musings only. And, unlike JAG's pal, while the cited lawsuits would appear to have come to an actual conclusion, those conclusions are really conclusions in theory only. Now JAG's friend is, we are told, in for long years of torture before his case gets dragged across the finish line. By that time, no current CMF member will still be alive. Nor will JAG's pal. His grandchildren will inherit and perhaps see the denouement of the whole debacle.