Practice question
A parent completely dictates a subsidiary’s relevant financial decisions and directs transfer of its only assets to the parent without consideration specifically to defeat an accrued employee judgment. Clear and convincing evidence establishes both the scheme and the resulting inability to collect. The entities invoke separate personality as an absolute bar. Which is best?
- The proved domination, wrongful use and causal injury can justify piercing for the relevant obligation
- Separate personality is always absolute even when used to defeat an existing obligation
- The parent is liable solely because it has shareholders
- Every unrelated affiliate also automatically becomes liable
- A judgment can never be protected against fraudulent corporate misuse
Legal references
- Maricalum Mining, G.R. 221813 and 222723, July 23, 2018: https://lawphil.net/judjuris/juri2018/jul2018/gr_221813_2018.html
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