Caple v. Raynel Campers, Inc., 7241

• Decision Date: 18 September 1974
• Docket Number: No. 7241,7241
• Citation: 90 Nev. 341,526 P.2d 334
• Parties: Carver CAPLE, Appellant, v. RAYNEL CAMPERS, INC., and Joseph C. Crouchet, Respondents.
• Court: Nevada Supreme Court

Page 334

526 P.2d 334

90 Nev. 341

Carver CAPLE, Appellant, v. RAYNEL CAMPERS, INC., and Joseph C. Crouchet, Respondents.

No. 7241.

Supreme Court of Nevada.

Sept. 18, 1974.

David Abbatangelo, Las Vegas, for appellant.

John H. Pilkington, Las Vegas, for respondents.

OPINION

ZENOFF, Justice.

In January of 1971 Joseph C. Crouchet purchased a 1964 pickup truck from Motor City, an auto sales company in Las Vegas. Several weeks later, although he was not in default of his installment payments, the truck was repossessed by a collection agency, Desert Thrift Institution. Checks written by Crouchet and paid to Desert Thrift were deposited to the account of Financial Corporation of America, an institution incorporated by appellant Caple.

Crouchet purchased the truck for $895.00, plus $47.00 for taxes and fees. He was allowed $400.00 for the trade-in of his 1962 Thunderbird, the balance to be paid in bi-weekly installments. After making several payments he discovered upon awakening one early morning that the pickup truck was gone and learned ultimately that the finance company had repossessed it. Although they acknowledged that the repossession was in error the employees of the financing institutions still required Crouchet to pay an additional $115.00, plus $45.00 repossession fee, but the truck was never returned to him nor made available for return. The loss included $700.00 worth of tools that were in the truck and a camper body owned by Raynel Campers, Inc. and loaned to Crouchet.

In his suit for damages the trial court gave judgment to Crouchet for $1,150.00 general damages, plus $15,000.00 punitive damages; it awarded $1,000.00 general damages to Raynel Campers, plus $5,000.00 in punitive damages. The judgment was joint and several against the named corporations, the individual employees of the corporations whose names were Rasmussen, Golden and others, but more importantly, Carver Caple, the principal incorporator and corporate officer of the two financing companies, Desert Thrift Institution, Inc. and Financial Corporation of America.

This is the appeal of Carver Caple who contends that the liability should extend only to the corporations, not to him and, further, that the awards of punitive damages were not justified.

1. We listed in North Arlington Medical Building Inc. v. Sanchez Construction Co., 86 Nev. 515, 520, 471 P.2d 240, 243 (1970), the requirements for the application of the alter ego doctrine: (1) the corporation must be influenced and governed by the person asserted to be its alter ego, (2) there must be such unity of interest and ownership that one is inseparable from the other, and (3) the facts must be such that adherence to the fiction of separate entity would, under the circumstances, sanction a fraud or promote injustice. Each of these elements is present in the findings of fact of the trial court and is supported by substantial evidence in the record.

The injustice to Crouchet and Raynel is apparent. The crass indifference by the employees, Golden and Rasmussen, who were responsible in the treatment accorded Crouchet amounts virtually to willful fraud. They wrongfully appropriated his chattel, then compelled him to pay additional cash and then made no effort to return his chattel or look for it or make him whole. This is the kind of malice that justifies punitive damages.

The first two of the three requisites to set aside the corporate veil are discernible without deep examination. Although his activities with the two corporations was described by Caple in obscure and ambiguous testimony, he alone stands out as the investing and directing force of both corporations. He was the sole investor and stockholder, the only person with direction and control. The corporate entities were a cloak for his personal operation in itself lawful and proper but not when used in an...