I think I will throw my hat in with Bill on this, incorporation definitely
does provide additional protection of personal assets. It does not protect
you from malpractice claims, but that is just one part of the law. A
corporation must act as a corporation, i.e.: it can't buy your groceries,
or else the corporate veil can be pierced.
This peeked my curiosity so I did a little searching on the web and found
the following Legal Web Site last night;
The stuff I could understand was listed under the subject of Legal
Documents, searching under malpractice and professional corporations and
Interesting topics included the requirement in many states that a "qualified
professional" must first prove negligence on the part of the engineer prior
to filing a law suit. In order to reduce frivolous suits.
There is something similar in California. An associate was named in a suit
for a light standard that had failed due to a rusted base-plate column
connection which was then subjected to cantenary cable forces from flagging
on a car lot. He had designed the foundation and had nothing to do with the
manufacture or maintenance of the light pole. He was able to get his legal
fees paid by the plaintiff's attorney who had not hired a qualified
professional to prepare a report prior to naming him in the suit. To say
that the plaintiff's attorney was pissed would be an understatement, he had
to pay for the original defense and the costs being of sued and experts and
all the other stuff attorneys heap on.
So sometimes there is a happy ending for us engineers.
Robert Shaffer, PE
Santa Cruz, CA
PS: Please add Steven Stills to the guitar virtuosos list.
From: Fountain Conner [mailto:fconner(--nospam--at)pcola.gulf.net]
Sent: Monday, April 02, 2001 1:00 PM
Subject: Re: Engineering from Home - Protecting Perso
Bill, you've been misled, perhaps by your "small business development
Incorporation is lovely, unless you're an engineer. There is a very cute
legal thing (I believe in all states) called "Piercing the Corporate
I know this applies in Louisiana and Florida, because I've checked (after
the fact, when I incorporated in Louisiana).
Before you spend the $$$ on incorporation (assuming protection from
lawsuits is the main goal), I'd make sure the protection you want is
available to you as an engineer.
I'll bet you a coke... ;-)
> From: Bill Polhemus <bill(--nospam--at)polhemus.cc>
> To: seaint(--nospam--at)seaint.org
> Subject: RE: Engineering from Home - Protecting Perso
> Date: Monday, April 02, 2001 1:43 PM
> I am going to incorporate based on information gained from a small
> development course I have been taking through the University of Houston.
> The fact is, a corporation WILL protect you from lawsuits, particularly
> the frivolous kind, because the corporation will be the entity that is
> not you personally.
> Also, while you're right that you can't "contract away negligence", the
> is that MOST lawsuits, and MOST jury awards, are for "frivolous reasons".
> you are at fault, you're at fault. But such a setup will prevent someone
> with a brief for just "getting" you for whatever reason, from coming away
> with anything of value.
> A Subchapter "S" seems to be fairly easy to set up, and does not penalize
> you unduly from taxes.
> William L. Polhemus, Jr., P.E.
> Polhemus Engineering Company
> Katy, Texas
> Phone 281-492-2251
> Fax 281-492-8203
> -----Original Message-----
> From: Roger Turk [mailto:73527.1356(--nospam--at)compuserve.com]
> Sent: Monday, April 02, 2001 3:19 PM
> To: seaint(--nospam--at)seaint.org
> Subject: Engineering from Home - Protecting Perso
> Unless your "corporation" is the registered structural engineer, the
> corporation does not protect anything.