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In fact, a 1991 empirical study concludes that "iercing the corporate veil is the most litigated issue in corporate law." 2 As a result, questions of piercing the corporate veil to hold a shareholder personally liable frequently arise. 1Įven more common for most lawyers is the disgruntled client who cannot collect her debt from an insolvent or bankrupt corporation and wants to look to the corporate shareholders whom she dealt with and trusted. In an article published in the Illinois Bar Journal more than 23 years ago, the author explores the defense of a disgruntled client sued personally on a corporate debt after being advised to incorporate his business to insulate himself from personal liability. In this article, the author examines undercapitalization law from Illinois and elsewhere and concludes that Illinois courts have not developed a coherent theory of undercapitalization as a justification for veil piercing. One of the most litigated issues in corporate law is whether the corporate veil should be pierced to hold shareholders personally liable.
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