From: James Daugherty (daugh@home.msen.com)
Date: Mon Sep 04 2000 - 08:07:03 MDT
Nonsense! Why should passive investors be responsible
for you house blowing-up. What about the officers of the
Corporation or the employees actually responsible for the
error?
James
----- Original Message -----
From: "James Wetterau" <jwjr@panix.com>
To: <hal@finney.org>
Cc: <extropians@maxwell.kumo.com>
Sent: Sunday, September 03, 2000 5:27 PM
Subject: Re: Bugs in free markets.
Hal wrote:
...
> Corporations are a matter of people getting together cooperatively to
> organize their efforts. How can it be evil for a group of people to
> voluntarily organize, and to offer jobs to others? Every aspect of
> the process, from the formation of the corporation, to the job offer,
> to the acceptance, is voluntary and agreed to by all concerned.
...
Actually, corporations receive limitations on their liability. So if,
for example, a simple business partnership up the block from me
accidentally causes my house to be blown up, I might be able to
successfully sue the business owners to recover damages. But if the
very same people have organized the otherwise identical business as a
corporation and do the very same thing, due to their magical limited
liability, the corporation must pay but the stockholders do not, since
their liability is limited. Now, perhaps the corporation does not
possess the resources to pay, but the stockholders do. In that case I
believe I would be out of luck. Of course there are sometimes ways to
"pierce the corporate veil" (sounds exciting doesn't it?). And
different standards of liability apply in different cases. IANAL.
But still, people incorporate for the liability limitations.
The only difference in the two instances could be that in the first
case the business might be a simple partnership, and in the second
case it was a corporation, having duly filed "articles of
incorporation" with the secretary of state of the state of
Massachusetts. And therefore in one case I can recover damages from
the business owners and in the other case I might not. This strikes
me as something which materially affects me to which I never agreed.
Regards,
James Wetterau
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