Reference no: EM131743320

Chili Cheese, a fast food corporation serving chili and a host of other American favorites, lost a substantial amount of revenue after the 2009 recession. The firm was set to go out of business in April 2010. However, in February of the same year, the major shareholder Miranda Pickering used corporate funds to purchase a million dollar house in Southern Florida, and then sold the house to herself for $10,000. Two of Chili Cheese’s creditors brought suit against Miranda, seeking to recover the funds that Miranda had spent. The court pierced the corporate veil, finding Miranda personally liable. Consequently, Miranda was ordered to repay the funds she had used to purchase the house.

But what if the facts of the case were different? Select each set of facts below that could change the outcome of the case.

Chili Cheese Inc. did not carefully maintain separate corporate and shareholder funds.

Chili Cheese was a de facto corporation.

Rather than buying a Floridian home, Miranda used corporate funds to invest in the training of more workers. Further, to the best of the court’s knowledge, Chili Cheese had followed all statutary mandates regarding corporate business and carefully maintained separate shareholder and corporate funds.

Miranda’s personal interests were commingled with Chili Cheese’s corporate goals.