More problems for the "B Team" from ST. Louis

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Riggerrob

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Perhaps large American corporations should adopt the Japanese business model. After major airline crashes, Japanese coporate presidents publicaly apologize to the victims' families (e.g. bowing) and resign in disgrace.
 

gtae07

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corporations have no purpose other than to deprive you of your rights.
And now we're right into hyperbole.

The concept of a corporation as a separate legal entity came about as a result of trying to solve the problem of how multiple people can share the assets of a company or organization. It's been a long historical tradition/principle that assets have to belong to someone; even government assets and land, for example, were long-considered the personal property of the sovereign (king/emperor/sultan/etc.). Under that model, if myself and two others go into business, let's say in lawncare, and we have a couple of trucks, some trailers, lawnmowers, etc., who owns them? If we have no way of separating out ownership of the company/organization from ownership of the physical assets, who gets what? If Joe owns the trucks, and Bill owns the lawnmowers, and I have the trailers, what happens when Joe says "screw you guys, I'm going home" and takes his trucks? We're in a bit of a bind. Scale that up to a modern industrial organization, like an aircraft or electronics manufacturer. Who owns the machines? Who owns the plant? Who gets stuck with the debt?

Corporations were thus created as separate legal entities to which assets and property could be assigned. The land, funds, machines, buildings, and other such items (including intellectual property in modern days), and all the liabilities (debts, accounts payable, etc.) are all held by the corporate entity, and the ownership of that entity is divided up proportionally among the shareholders.

The corporation structure is also intended to allow people to "firewall" their non-invested personal assets from those of the corporation when it comes to liabilties (in the balance sheet/bankruptcy sense). It gives enterpreneurs some cover to make a business venture without worry that, if the business flops and goes bankrupt, or is sued for things like contractual/warranty issues or something, the business's creditors will come and take their house, car, retirement savings, etc. In exchange, the assets of the corporation are supposed to remain separate from the personal use/assets of the individuals who own said corporation. This is why using a company vehicle for personal use is a tax violation, for example. But the protections are not intended to shield owners from tort liability that arises from their personal actions; I'd have to go back and look at my notes from class to see what the specifics and terms are but shareholders definitely can be held personally liable in such cases.

You can also see this at play in something like a flying club or partnership with an airplane. Setting up an LLC for your airplane partnership and assigning it assets (maintenance fund, hangar lease, misc. tools, the airplane itself, etc.) makes it very easy to buy into or out of that partnership, without Joe deciding that he wants out and is going to take his engine with him. But, assigning that airplane to an LLC does not shield you from personal liability if you go do something stupid and get someone hurt.

Nowadays, usually when people talk about (read: complain about) "corporations", they are typically referring to "publicly-held corporations" where shares in the entity are widely and freely available for purchase by the general public, and said shareholders are not typically involved in the day-to-day operations or policies (their involvement being limited to election of board members and perhaps very large decisions like mergers). The social and ethical duties of publicly-held corporations are perhaps matters of great interest and deserve lots of attention, but I think we've probably already drifted the thread far enough off-topic. My main point here is to illustrate that "corporation" encompasses many things (even some directly relevant to personal aviation, the kit industry, etc.), not just massive entities like Boeing, Apple, Microsoft, and so on...
 

Riggerrob

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More recently that concept was re-invented by Prof. Hanlon: "Never blame on cruelty that which can also be explained by stupidity."

I have been struggling with an insurance company's lawyers for 13 years after a plane crash. The crash caused me multiple injuries. Lawyers aggravated my injuries by dragging out a court case for 9 years and delayed knee surgery by an extra 2 years.
 

Pops

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I prefer a good grilled cheese sandwich with my "mater" soup
With dill pickles on the side.
And now we're right into hyperbole.

The concept of a corporation as a separate legal entity came about as a result of trying to solve the problem of how multiple people can share the assets of a company or organization. It's been a long historical tradition/principle that assets have to belong to someone; even government assets and land, for example, were long-considered the personal property of the sovereign (king/emperor/sultan/etc.). Under that model, if myself and two others go into business, let's say in lawncare, and we have a couple of trucks, some trailers, lawnmowers, etc., who owns them? If we have no way of separating out ownership of the company/organization from ownership of the physical assets, who gets what? If Joe owns the trucks, and Bill owns the lawnmowers, and I have the trailers, what happens when Joe says "screw you guys, I'm going home" and takes his trucks? We're in a bit of a bind. Scale that up to a modern industrial organization, like an aircraft or electronics manufacturer. Who owns the machines? Who owns the plant? Who gets stuck with the debt?

Corporations were thus created as separate legal entities to which assets and property could be assigned. The land, funds, machines, buildings, and other such items (including intellectual property in modern days), and all the liabilities (debts, accounts payable, etc.) are all held by the corporate entity, and the ownership of that entity is divided up proportionally among the shareholders.

The corporation structure is also intended to allow people to "firewall" their non-invested personal assets from those of the corporation when it comes to liabilties (in the balance sheet/bankruptcy sense). It gives enterpreneurs some cover to make a business venture without worry that, if the business flops and goes bankrupt, or is sued for things like contractual/warranty issues or something, the business's creditors will come and take their house, car, retirement savings, etc. In exchange, the assets of the corporation are supposed to remain separate from the personal use/assets of the individuals who own said corporation. This is why using a company vehicle for personal use is a tax violation, for example. But the protections are not intended to shield owners from tort liability that arises from their personal actions; I'd have to go back and look at my notes from class to see what the specifics and terms are but shareholders definitely can be held personally liable in such cases.

You can also see this at play in something like a flying club or partnership with an airplane. Setting up an LLC for your airplane partnership and assigning it assets (maintenance fund, hangar lease, misc. tools, the airplane itself, etc.) makes it very easy to buy into or out of that partnership, without Joe deciding that he wants out and is going to take his engine with him. But, assigning that airplane to an LLC does not shield you from personal liability if you go do something stupid and get someone hurt.

Nowadays, usually when people talk about (read: complain about) "corporations", they are typically referring to "publicly-held corporations" where shares in the entity are widely and freely available for purchase by the general public, and said shareholders are not typically involved in the day-to-day operations or policies (their involvement being limited to election of board members and perhaps very large decisions like mergers). The social and ethical duties of publicly-held corporations are perhaps matters of great interest and deserve lots of attention, but I think we've probably already drifted the thread far enough off-topic. My main point here is to illustrate that "corporation" encompasses many things (even some directly relevant to personal aviation, the kit industry, etc.), not just massive entities like Boeing, Apple, Microsoft, and so on...
And retain a good corp lawyer for the board meeting so you will not do something stupid and dissolve the firewall.
 

Pilot-34

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Most of me is in IL but my hearts in Alaska
I agree with the dill pickles, but don't have a clue about the lawyer board meeting thing.
With dill pickles on the side.

And retain a good corp lawyer for the board meeting so you will not do something stupid and dissolve the firewall.
Pops is referring to the soul unique purpose of a corporation and that is to deprive people of their rights.
Pop is referring to the fact that a corporation is usually arranged so that if you do something stupid where you would normally be a liable to somebody else for that they are left to do without your assets cannot be made to pay for the mistakes you made.
In other words it’s prearranged legalized theft
 

Pilot-34

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And now we're right into hyperbole.

The concept of a corporation as a separate legal entity came about as a result of trying to solve the problem of how multiple people can share the assets of a company or organization. It's been a long historical tradition/principle that assets have to belong to someone; even government assets and land, for example, were long-considered the personal property of the sovereign (king/emperor/sultan/etc.). Under that model, if myself and two others go into business, let's say in lawncare, and we have a couple of trucks, some trailers, lawnmowers, etc., who owns them? If we have no way of separating out ownership of the company/organization from ownership of the physical assets, who gets what? If Joe owns the trucks, and Bill owns the lawnmowers, and I have the trailers, what happens when Joe says "screw you guys, I'm going home" and takes his trucks? We're in a bit of a bind. Scale that up to a modern industrial organization, like an aircraft or electronics manufacturer. Who owns the machines? Who owns the plant? Who gets stuck with the debt?

Corporations were thus created as separate legal entities to which assets and property could be assigned. The land, funds, machines, buildings, and other such items (including intellectual property in modern days), and all the liabilities (debts, accounts payable, etc.) are all held by the corporate entity, and the ownership of that entity is divided up proportionally among the shareholders.

The corporation structure is also intended to allow people to "firewall" their non-invested personal assets from those of the corporation when it comes to liabilties (in the balance sheet/bankruptcy sense). It gives enterpreneurs some cover to make a business venture without worry that, if the business flops and goes bankrupt, or is sued for things like contractual/warranty issues or something, the business's creditors will come and take their house, car, retirement savings, etc. In exchange, the assets of the corporation are supposed to remain separate from the personal use/assets of the individuals who own said corporation. This is why using a company vehicle for personal use is a tax violation, for example. But the protections are not intended to shield owners from tort liability that arises from their personal actions; I'd have to go back and look at my notes from class to see what the specifics and terms are but shareholders definitely can be held personally liable in such cases.

You can also see this at play in something like a flying club or partnership with an airplane. Setting up an LLC for your airplane partnership and assigning it assets (maintenance fund, hangar lease, misc. tools, the airplane itself, etc.) makes it very easy to buy into or out of that partnership, without Joe deciding that he wants out and is going to take his engine with him. But, assigning that airplane to an LLC does not shield you from personal liability if you go do something stupid and get someone hurt.

Nowadays, usually when people talk about (read: complain about) "corporations", they are typically referring to "publicly-held corporations" where shares in the entity are widely and freely available for purchase by the general public, and said shareholders are not typically involved in the day-to-day operations or policies (their involvement being limited to election of board members and perhaps very large decisions like mergers). The social and ethical duties of publicly-held corporations are perhaps matters of great interest and deserve lots of attention, but I think we've probably already drifted the thread far enough off-topic. My main point here is to illustrate that "corporation" encompasses many things (even some directly relevant to personal aviation, the kit industry, etc.), not just massive entities like Boeing, Apple, Microsoft, and so on...

I don’t think it’s hyperbole at all .
The only unique feature of a corporation is its ability to deprive others of their rights ahead of time.
All of the other things a corporation does can be done in other forms of ownership that is why often to help make things a little clearer governments require that they use the term limited or limited liability corporation.
I’ve always thought the term should be “we are planning to rip you off “ so that everybody could understand it.
 

Victor Bravo

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OTOH, in our current society today, if you make a product, and someone mis-uses it or uses it outside its intended purpose, you can be sued for something that is largely not due to your wrongdoing, and lose everything you have.

If that happens, who is the victim? The guy who invents a light bulb, and is sued by someone who used that light bulb as a seat cushion, and then sues the inventor for getting injured.

So corporate protection against this kind of miscarriage of justice may not be such a bad thing.
 

AdrianS

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One problem with large corporates is that often the profits they make from illegal behaviour far outweigh any fines imposed. This means that any fines are just part of their costs, and are even tax deductible in some cases. This does not provide much incentive for them to do the right thing.

No, I don't have a solution.
 

Pilot-34

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Most of me is in IL but my hearts in Alaska
OTOH, in our current society today, if you make a product, and someone mis-uses it or uses it outside its intended purpose, you can be sued for something that is largely not due to your wrongdoing, and lose everything you have.

If that happens, who is the victim? The guy who invents a light bulb, and is sued by someone who used that light bulb as a seat cushion, and then sues the inventor for getting injured.

So corporate protection against this kind of miscarriage of justice may not be such a bad thing.
That would be a flaw in the legal system too ,do you have any examples?
 

Victor Bravo

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That would be a flaw in the legal system too ,do you have any examples?

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