PJC Business 2024

P IERCING THE C ORPORATE V EIL

PJC 108.7

PJC 108.7 Instruction on Protection of Crime or Justification of Wrong PJC 108.7A Instruction on Protection of Crime or Justification of Wrong in Cases Governed by Tex. Bus. Orgs. Code § 21.223(a)(2) Don Davis used [ name of corporation ] to protect a crime or justify a wrong for the purpose of perpetrating and did perpetrate an actual fraud on Paul Payne primarily for the direct personal benefit of Don Davis . [or] PJC 108.7B Instruction on Protection of Crime or Justification of Wrong in Cases Not Governed by Tex. Bus. Orgs. Code § 21.223(a)(2) Don Davis used [ name of corporation ] to protect a crime or justify a wrong, and holding only [ name of corporation ] responsible would result in injustice. [or] COMMENT When to use. PJC 108.7 should be used as an instruction accompanying the ques tion in PJC 108.1 if it is alleged that a defendant used a corporation to protect a crime or justify a wrong. Use PJC 108.7A in those contract-related matters governed by Tex. Bus. Orgs. Code §21.223(a)(2) and PJC 108.7B in other matters. For additional dis cussion on section 21.223(a)(2), see PJC 108.2. Use of “or.” If used with other instructions (see PJC 108.3–108.6 and 108.8), PJC 108.7 must be followed by the word or , because a finding of any one of the theories for disregarding the corporate fiction defined in the instructions would support an affirmative answer to the question. “Protection of crime.” Castleberry v. Branscum , 721 S.W.2d 270 (Tex. 1986), lists “protection of crime” as one of the grounds for disregarding the corporate fiction. This phrase appears to include but not be limited to “perpetration of crime.” Its scope includes, therefore, not only those situations in which the party commits a crime but also situations in which a crime has been abetted or the criminal has otherwise received assistance. The practitioner should amend this question as appropriate to reflect the facts of the case.

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