*1 INDUSTRIES, INC., Appellee, LUMAX Mary AULTMAN, individually, Carol and as owner operator MCA, Inc., Appellant.
Supreme Pennsylvania. Court of
Argued Sept. 1995. Decided Dec. 1995. *2 Fonner, Galloway, Greensburg, Richard H. Ronald J. Bridgeville, Mary for Aultman. Andrews, Passarello, Altoona,
David P. Lisa for Lumax Ind. NIX, C.J., FLAHERTY, ZAPPALA, CAPPY, and Before MONTEMURO, JJ. CASTILLE THE
OPINION OF COURT FLAHERTY, Justice. Industries,
Lumax Inc. manufactures fluorescent fixtures. MCA, Inc. for agreed pay ordered fixtures which to third on parties. Lumax delivered When MCA defaulted brought Lumax an action for of contract payment, breach *3 against Mary individually Carol Aultman and the owner MCA, of that Aultman operator alleging and MCA failed to for Lumax pay goods sought judgment against delivered. $86,304.60 in plus Aultman the amount of costs and interest. In of claim that support individually its Aultman was re- MCA, for the Lumax sponsible alleged: debts hereto, Defendant, Mary 13. At all times material Carol herself, acting unjustly seeking Aultman was on behalf of protection. hereto, Defendant, 14. At all times material Mary Carol in only person actively day-to- Aultman was the involved the MCA, day operations of Inc. objections
Aultman filed in of a preliminary the nature demur- rer, asserting adequately pleaded that Lumax had not a cause theory of action on the veil. The denied, trial, proceeded jury demurrer was the case to and a $70,000 returned a verdict of favor of Lumax. Post-trial denied, appealed motions were filed and and Aultman to Superior Court. demurrer,
Superior stating Court affirmed the denial of the complaint that the averments 13 and were pierce sufficient to veil. Paragraphs 13 14, above, set out are only paragraphs the com- plaint which a bearing have on this issue. granted We allocatur to the question pleadings address of whether this case were sufficient to withstand the demurrer. For the follow, they reasons that we conclude that were not.
In ruling on a A only demurrer can be sustained where the is clearly insufficient to pleader’s establish the right re- lief---- For purpose testing the legal sufficiency of the challenged pleading preliminary objection in the na- ture of a material, demurrer admits as true all well-pleaded, relevant facts ... and every fairly inference from deducible those pleader’s facts.... The conclusions or averments of law are not considered to be admitted as by true a demur- rer____
Since sustaining of a demurrer results a denial of pleader’s suit, claim or a dismissal of his preliminary objection in the nature of a demurrer should be sustained only in clearly cases that and without a doubt fail to state a claim for may which relief granted____ be If the facts as pleaded a claim state for which relief may be under any theory law then there is sufficient doubt to require the preliminary objection in the nature of a demurrer rejected. Commonwealth,
County Allegheny 360, (Citations (1985) omitted). A.2d then, inquiry, Our material, whether Lumax has set out *4 relevant, which, true, if well-pleaded facts state a claim for which may relief be any theory under of law. In addressing inquiry, we are mindful that a demurrer facts, admits as well-pleaded true all but does not admit conclusions or averments of law.
We note at the outset that there is a strong pre sumption in Pennsylvania against piercing corporate veil. Board, v. Wedner Unemployment 460, 464, 296 A.2d 792, (1972) 794 (“[A]ny court must start from the general rule
42 entity recognized upheld, should be corporate
that the
excep-
call for an
circumstances
specific, unusual
unless
tion____
on all occasions to avoid
should be taken
Care
* * * useless.
corporate entity
of
making
theory
the entire
Cir.1967)”).
(3d
Also,
Zubik,
267,
v.
384 F.2d
273
Zubik
an
regarded as
corporation
is that a
shall be
rule
general
entirely by one
if
stock is owned
entity even
its
independent
H. New-
Group, Inc. v. William
College
person.
Watercolor
(1976).
200,
Inc.,
103, 117,
207
bauer,
Pa.
360 A.2d
468
out the factors to be
Court has set
Commonwealth
form as follows:
corporate
disregarding
considered
formali-
corporate
failure to adhere
undercapitalization,
ties,
corporate
personal
of
intermingling
substantial
a fraud.
corporate
perpetrate
use of the
form
affairs and
Run
Peggs
Resources v.
Environmental
Department of
(1980).
312,
Co,
Ct.
Coal
Comwlth
Resources, 108 Pa.Cmwlth.
Dept.
v.
Environmental
Kaites
(1987).
1148,
also
267, 273,
A.2d
See
Watercolor
207,
117,
Newbauer,
(corpo
We action state a cause of 13 and Paragraph veil. theory piercing on a only involved person that Aultman was the alleges which MCA, and immaterial to the is irrelevant operation above, a is to be corporation As stated cause of action. entity if its stock is owned independent as an even regarded Newbauer, person. supra. one entirely by on that Aultman acted behalf Paragraph averring stated, is a herself, unjustly seeking corporate protection, In order to withstand conclusion of law. that would allegedly Aultman did must state what
pleader of a cause of action parameters actions within the bring her Kaites, veil. See theory on a based et al.: Frey Dougherty et al. v. As this court stated supra. *5 it is not to set in a necessary pleading While forth by proved, evidences which facts are to be it is essential that such pleader depends upon liability facts to show the averred____ sought to be enforced shall be 45, 48, 132 (1926). A. holding sanctity The this case well illustrates the Pennsylvania. structure The veil will jurisdiction not pierced absent the factors of the sort Kaites, expressed supra. Superior
Order of is judgment Court reversed. The vacated.
ZAPPALA, J., NIX, C.J., dissenting opinion files which joins.
MONTEMURRO, J., is sitting by designation as a senior 701(f). judge as provided by Rule of Judicial Administration ZAPPALA, Justice, dissenting. case,
Due to the I procedural posture of the must dissent. I Although agree that the two averments in 14 were insufficient I withstand believe this became a moot place issue after the trial took and the jury $70,000.00 awarded Lumax a verdict. trial, testimony
At provided that: ... primarily MCA was established Kinney handle the orders with Lumax when [Appellant’s] longer father was no able to deal with Kinney. [Appellant] testified Lumax comprised dealings 80-85% the business [TT. MCA. officer, [Appellant] 31] is the sole shareholder and full-time employee corporation MCA. The issued no stock and accountant, had no fixed assets. The Mr. Kays [TT. 80] corporate expenses testified the gave appear- [sic] listed being ance of unrelated to the corporation. business [TT. The period 83-86] minutes for the time pages. [TT. of three handwritten consisted 1/26/87-1/16/90 32] *6 at 5. Opinion
Trial Court that, complaint or not the found “[w]hether The trial court longer no of action is to set forth cause was sufficient facts of this case decided juryA heard the relevant issue. the piercing sufficient warrant the evidence was at 4-5. Opinion Trial veil.” Court trial to support at presented I As evidence was agree. veil, cannot pleading the deficient Furthermore, well-estab- it is what has occurred. now erase allow a plaintiff the discretion to that the court has lished at trial. See proof to conform to the amend 1033. Pa.R.Civ.P. would plaintiff court
Had the its pleading to amend mostly likely opportunity have had the with any outright dismissal not have suffered and would from Thus, greater receive relief Appellants prejudice. a result granted, than if their demurrer had been Majority unjust.1 unacceptable I find C.J., NIX, joins Dissenting Opinion.
MONTEMURO, J.,
by designation as a senior
participates
701(f).
Administration
by Rule
Judicial
judge
provided
majority’s
further dem-
injustice resulting
conclusion is
1. The
from
pro-
compared
in a criminal
to similar circumstances
onstrated when
to establish a
ceeding.
that the Commonwealth's
failure
We have held
hearing
at
preliminary
immaterial where
trial
prima
at the
facie case
proof beyond a reasonable doubt.
its burden of
the Commonwealth met
(1983). See
McCullough,
Pa.