According to the facts in this case, Walkovszky was hit by a cab four years ago in New York and the cab was negligently operated by defendant Marches. The defendant Carlton, who is being sued, owned and ran the cab company in which he set up ten corporations, including Seon. Each of the corporations had two cabs registered in its name. The minimum automobile liability insurance required by the law was $10,000. According to the opinion of the court the plaintiff asserted that he is also ?entitled to hold their stock holder personally liable for damages, because multiple corporate structures constitutes an unlawful attempt to defraud the general member of the public.?
The main legal issue before the court arises, in determining whether liability should be extended to reach assets beyond those belonging to the corporation and whether the corporate veil should be pierced with regard to personal liability to others.
Judge Flud wrote the majority decision in the case, and found that Carlton was not personally liable for the damages to Walkovszky. Flud also found that in his reasoning, Walkovsky has ?failed to state a valid cause of action against defendant Carlton?. Flud states that if the corporation ...
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...ook at the fact that he had enough money to put forward to his liability insurance. However, he chose not to and he stayed with the minimum amount, which Carlton knew would not be enough to cover any sufficient damages of an injury.
In referring Legal Realism to this case, Legal Realism can be defined as the way judges formulate law from their own personal conception of justice, not from precedent or rules. Each decision involves a personal choice. Judge Flud gave the majority decision in the case and his decision is that Carlton came from a higher background. Flud?s background already holds a high status in society, therefore it affected his decision in the case in favor of Carlton and not Walkovszky. This higher status enabled Fuld to appreciate Carlton?s perspective and what it might mean if Walkovszky was able to piece the corporate veil.
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