If a Business Entity Is Created to Insulate Its Owners

question 44

True/False

If a business entity is created to insulate its owners from person liability beyond their contributions, a court will "pierce the corporate veil" and hold these people personally liable for obligations to their creditors because what they have done is considered a fraud on creditors.

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Definitions:

Tectonic Settings

The environmental and geological conditions that relate to the movement and interaction of Earth's tectonic plates.

Continental Lithosphere

The solid outer layer of the earth that includes the crust and the uppermost mantle, specific to continents and characterized by its thickness and composition which differ from the oceanic lithosphere.

Magmatism

The geological process involving the generation, movement, and solidification of magma or molten rock beneath the Earth's surface.

Plate Boundaries

Regions where two tectonic plates meet, which can result in geological activity such as earthquakes and volcanic eruptions.