Before This Corporation Was Formed, This Contract Knew It
In Section 4.13 of Bishop & Zucker on Nevada Corporations and Limited Liability Companies, we discuss who may be liable on pre-incorporation contracts. In Hotel Last Frontier Corp., v. Universal Match Co., 358 P.2d 896 (Nev. 1961), the Nevada Supreme Court held that a corporation could be held liable to a seller of matchbooks when it signed a purchase agreement Read more...
Giving Voice To Statutes – If You Don’t Understand Diathesis, You May Not Understand The Statute
Although rules of grammar may be a distant memory for many lawyers, the rules of grammar can be important to statutory construction. Nevada Revised Statutes (NRS) Section 0.025(1) establishes specific rules for the interpretation of statutes using “may”, “must”, “shall” and “is entitled”. Thus, “‘must’ expresses a requirement when: (1) the subject is a thing, whether the verb is active or Read more...
What Doth The Alter Ego Doctrine Require Of Thee, But To “Do Justice”?
Yesterday’s post briefly discussed the internal affairs doctrine and alter ego claims. Professor Stephen Bainbridge responded with this post which discusses the approaches of courts in New York and Delaware. Professor Bainbridge recently wrote an article on reverse veil piercing and the free exercise rights of incorporated employees. He describes reverse veil piercing as “a corporate law doctrine pursuant to which a Read more...
Alter Ego And The Internal Affairs Doctrine
The internal affairs doctrine is a conflict of laws principle that recognizes that only one state should have the authority to regulate a corporation’s internal affairs. Under the internal affairs doctrine, that special state is the state of incorporation. But what exactly constitutes a corporation’s ”internal affairs”? Many lawyers, particularly those in Delaware, take a broad view of what constitutes an internal affair. However, Read more...
Is An Immoral Contract Unlawful?
Last week, I wrote about a proposal by the Nevada Secretary of State to ban the establishment of a corporation for an ”illicit purpose“. Currently, Nevada specifically authorizes the formation of corporations to transact any “lawful” business and for “legitimate” purposes, NRS 78.030(1), while California permits corporations to be formed for “lawful” purposes, Cal. Corp. Code § 202(b)(1). “The illegality of contracts Read more...
Nevada Legislature May Prohibit The Establishment of Corporations For “Illicit Purposes”
Nevada’s legislature meets in regular session every other year for 12o consecutive calendar days. Nev. Const. Art. II, § 4 and NRS 218A.078. Although the 77th session does not start until February 4, legislators are already introducing bills. Because Nevada is often associated with legalized gaming and prostitution (the latter only in certain counties, see NRS 244.345), it may come as Read more...
Lincoln (The Movie) Overlooks Nevada
Steven Spielberg’s new film, Lincoln, focuses not on the assassination of the President or the end of the Civil War, but on Congress’ passage of the Thirteenth Amendment. The film depicts President Lincoln as a skilled, but not overly scrupulous, politician dedicated as much to ending slavery as to ending the war. According to the film, Lincoln’s success is not Read more...
