Soerries C. Dancause

546 S.E.2d 356 (2001)

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Nature of the Case

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Facts

D was the sole shareholder of Chickasaw Club, Inc., which operated a popular nightclub in Columbus. At approximately 11:45 p.m. on July 31, 1996, 18-year-old Aubrey Lynn Pursley was intoxicated when she entered the Chickasaw Club. Although a Columbus ordinance prohibits individuals under 21 years old from entering nightclubs, it is undisputed that club employees did not check Pursley's identification to establish her age. Pursley was intoxicated when she arrived at the club. Pursley drank additional alcohol at the club and was visibly intoxicated when she left at approximately 3:00 a.m. She left the club with a beer in her hand. Pursley was killed when she lost control of her car and struck a tree. Dancause (P), Pursley's stepfather, sued Chickasaw Club, Inc. and D individually for the cost of the car and for punitive damages. It is undisputed that D paid his employees, suppliers, and entertainers in cash and not from existing corporate checking accounts. One employee admitted he was paid 'under the table.' The employee never appeared on corporate payroll records, although D admitted giving him money to help out around the club. Corporate tax returns showed that, even though the Chickasaw Club was a busy nightclub, it regularly declared business losses. D explained that he often paid the corporate expenses out of his personal funds. D testified that he paid his $4,830 monthly mortgage note from the club's cash proceeds. Personal tax returns showed that he received only $34,173 in rent in 1996, even though the corporation reported paying $43,000 in rent in its 1996 corporate tax return. Both figures are significantly less than the $57,960 in rent that would have been due from the corporation, based upon 12 months of $4,830 rental payments. D also owned other rental property in 1996 that would have paid $3,150 per month, making the disparity between his alleged rental earnings and his reported income even greater. The jury's verdict pierced the corporate veil and found d jointly liable with the corporation for $6,500 in compensatory damages and solely liable for $187,500 in punitive damages. Ds appealed.