Mr. Pacman filed a collection action against “PDP” Corporation. Upon execution of the court’s decision, “PDP” Corporation was found to be without assets. Thereafter Mr.Pacman filed an action against its present and past stockholder “Laban” Corporation which owned substantially all of the stocks of “PDP” Corporation. The two corporations have the same board of directors and “Laban” Corporation financed the operations of “PDP” Corporation. May “Laban” Corporation be held liable for the debts of “PDP” Corporation? Why?

Mr. Pacman filed a collection action against “PDP” Corporation. Upon execution of the court’s decision, “PDP” Corporation was found to be without assets. Thereafter Mr.Pacman filed an action against its present and past stockholder “Laban” Corporation which owned substantially all of the stocks of “PDP” Corporation. The two corporations have the same board of directors and “Laban” Corporation financed the operations of “PDP” Corporation. May “Laban” Corporation be held liable for the debts of “PDP” Corporation? Why?

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter6: Corporations: Redemptions And Liquidations

Section: Chapter Questions

Problem 58P

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