Virginia
How DeWitt Truck Brokers, Inc. v. W. Ray Flemming Fruit Co. applies in Virginia: state-specific rules, key cases, and bar exam notes for Business Associations (Piercing the Corporate Veil).
Virginia courts adhere to the principle of piercing the corporate veil primarily to prevent unfairness or fraud. Similar to the DeWitt case, Virginia requires a showing of unity of interest and ownership to determine whether the corporate form is being misused.
In Virginia, the corporate veil may be pierced when there is a substantial overlap of ownership and control, and when adherence to the corporate form would promote injustice or fraud.
The court found that the corporate veil could be pierced due to fraudulent conduct directly connected to the plaintiff's claims.
The court ruled that where there is a lack of separate corporate existence and co-mingling of funds, piercing the veil is warranted.
The decision affirmed that courts will pierce the corporate veil when an owner uses a corporation solely for personal convenience.
Virginia's approach to piercing the corporate veil is similar to federal standards in that it seeks to prevent misuse of the corporate structure. However, Virginia places a heavier emphasis on evidencing fraud or injustice tied to specific instances rather than a broader evaluative standard used in federal cases.
Candidates should be familiar with the principle of piercing the corporate veil and its application in specific Virginia cases, as this is a common topic tested on the Virginia bar exam.