Case Study: Happy Acres and Insurance

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Table of Contents

Introduction
Procedural History
Issue
Rule
Analysis
Conclusion
Works Cited

Introduction

Last year, Jenny Jones’ mother was admitted to Happy Acres since he had advanced Alzheimer’s disease. Being on the second floor of the facility, she fell down the stairs and broke her hip, and got a concussion. The patient eloped through a door which was proposed since the air conditioning was not working. The alarm did not go off to provide the relevant alert. The nursing home had failed to implement the relevant measures to maximize the safety of the individual. John Greco is the owner of both Shady Oaks and Happy Acres. With an operating capital of 300,000 US dollars, Happy Acres only has an insurance cover that compensates amounts of 1 million US dollars or less depending on the incident.

Procedural History

The United States lacks a uniform standard regarding the process of veil piercing. However, states have unique regulations that guide courts to pursue this issue depending on the facts of the case. The guiding case in Broward Marine, Inc. vs. S/V Zeus, No. 05-23105CIVOSULLIVAN, 2010 WL 427496 of the U.S. District Court for the Southern District of Florida (Jimerson & Cobb P.A.). The court proved that shareholders of businesses could be liable for torts arising from organizational malpractices. This opinion is crucial for the success and outcome of the current case.

Issue

The current case has emerged after Jenny Jones has sued Happy Acres nursing facility and its owner, John Greco, for 5,000,000 US dollars for the death of her mother. She believes that the institution neglected the wellbeing of the patient. Since the facility offers insurance cover for only a million US dollars, the inclusion of Greco as a respondent is a move aimed at balancing the damages since he has adequate financial resources. The outstanding issue for this case is: Will Jenny Jones recover the intended compensation from Greco by piercing the corporate veil?

Rule

Healthcare facilities should maintain the highest level of standards when providing medical services. Such institutions will be liable for any injury and death arising from medical malpractice. The environment should be able to provide the required patient safety. They should achieve this aim by maintaining and servicing equipment to ensure that they remain functional. The door in question propped open since the air conditioning in the ward was not working. Hospitals should have the relevant measures to protect the wellbeing and safety of their patients (Kabour 68). Veil piercing is a common strategy for handling cases involving corporations and businesses that are closed.

Depending on the nature of the case, courts can reconsider limited liabilities by holding shareholders, leaders, and directors personally liable for their organizations’ debts, actions, and errors. The judges involved will have to identify specific factors to determine when to pierce the corporate veil. Some of them include engagement in fraud, failure to adhere to corporate rules and formalities, and inappropriate actions that result in the issue in question (Studdert and Mello 431). This aspect explains why small facilities have higher chances of becoming vulnerable to such a judicial process.

Analysis

The above section has outlined the major legal provisions governing the performance of healthcare facilities. When the managers and workers in such organizations fail to complete their duties diligently, the chances of being sued increase significantly. According to the nature of this case, it is agreeable that Jenny Jones is aware that the alarm responsible for preventing a fall was not working. In the case of Happy Acres, those who were required to protect patients failed to complete their duties professionally. They ignored the air conditioning system by not repairing it immediately (Kabour 60). A series of events in the facility created a scenario that resulted in the fall of Jones’ mother.

The four elements of negligence apply to this case. First, the facility and all the workers had a responsibility to protect the targeted patients. Second, those in charge of the alarm and air conditioning systems breached the outlined corporate formalities for protecting all stakeholders (Kabour 61). Third, these malpractices created the circumstances that led to the unexpected death of Jones’ mother. Fourth, the court would argue and agree that there was negligence at the facility.

The concept of piercing the corporate veil would be applicable in such a situation since the two facilities have the potential to raise the requested amount. The court will also observe that Happy Acres had failed to follow the required provisions, safety standards, and guidelines to meet the demands of all patients (Studdert and Mello 429). This kind of malpractice explains why Jones’ mother slipped and broke her hip and got a concussion. The serious injury led to her untimely death. Since the liability has been set at only 1 million US dollars, the court would have adequate information to make its final decision.

Conclusion

The application of the selected legal principles and facts reveal that the leaders at Happy Acres failed to follow the outlined guidelines for protecting patients. While the institution’s insurance cover will only cover each incident up to the amount of 1 million US dollars, the court will find a reason to pierce the corporate veil to compel the owner to provide the requested 5 million US dollars. In conclusion, Jones will be in a position to recover the intended compensation from Greco by piercing the corporate veil.

Works Cited

Jimerson & Cobb P.A. “The Five Most Common Ways to Pierce the Corporate Veil and Impose Personal Liability for Corporate Debts.” Lexology, 2016. Web.

Kabour, Reem. “Revisiting the Inhibited Doctrine of Piercing the Corporate Veil in English Company Law.” The King’s Student Law Review, vol. 9, no. 2, 2019, pp. 59-73.

Studdert, David M., and Michelle M. Mello. “In From the Cold? Law’s Evolving Role in Patient Safety.” DePaul Law Review, vol. 68, no. 2, 2019, pp. 421-458.

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