Swinerton Builders v. Craig Nassi, 2012COA7 (Feb. 2, 2012)

In this case, attorneys clash over piercing the corporate veil.  An LLC’s veil failed to shield a shareholder from being personally responsible for attorneys’ fees incurred in a veil-piercing lawsuit, following an arbitration award.  Swinerton won an arbitration award against Beauvallon, an LLC owned by Nassi. Swinerton then brought a lawsuit to pierce Beauvallon’s veil to collect the arbitration award against Nassi.  The trial court ruled for Swinerton, who then sought to recover attorneys’ fees incurred in the veil-piercing litigation, which the trial court denied.  The Court of Appeals reversed, and held that when an LLC’s corporate veil is pierced, shareholders are liable for all the LLC’s contractual obligations.  Therefore, Swinerton could enforce the contract’s attorney-fee shifting provision to recover fees against Nassi on the veil-piercing action.



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