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AuroraNova Shipping, Inc. is a domestic corporation organized under the Revised Corporation Code. It borrowed PHP 18,000,000 from CityBank to finance the construction of a cargo vessel, with the loan documented in the name of AuroraNova Shipping, Inc. Subsequent investigation reveals that the bank’s funds were largely used to finance the personal investments of the company’s president, who also controls several shell companies that own assets in his name. Corporate funds were commingled with personal funds, and corporate formalities were irregularly observed. CityBank sues AuroraNova Shipping, Inc. only, and the president is not named as a party. CityBank seeks relief.
(a) Define separate juridical personality and identify who possesses it in a corporate form.
(b) Distinguish corporate liability from stockholders’ liability and state the usual exceptions that permit piercing the corporate veil.
(c) Based on the facts, can CityBank pierce the corporate veil to reach the president personally? If yes, specify the elements that must be proven; if not, justify why not.