Reference no: EM133613303

Question: A book on Corporations Law says: "Issue-spotting tip: Where piercing the corporate veil is at issue, the facts often will also raise the issue of promoter liability for pre-incorporation contracts and breaches of fiduciary duties by directors. This issue often arises in situations where there are few shareholders and courts are more likely to pierce the corporate veil for tortious acts and not for contract issues." Why is it that if piercing the corporate veil is at issue, the facts often will also raise the issue of promoter liability for pre-incorporation contracts? how are those two topics (preincorporation actions and piercing the veil) connected?