## Facts

- Greer and Alan Glanzer and Dehon Industries, Inc. formed a limited partnership, Glanzer Tackle Company, to manufacture and distribute fishing tackle.
- The Glanzers contributed assets of their prior tackle business (including inventory, equipment, customer list, goodwill, and the Glanzer name).
- Dehon agreed to contribute $30,000 cash and provide one year of accounting services, space, and payment of utilities and property taxes.
- Dehon also agreed to pay the Glanzers $20,000 for the contributed assets: $10,000 due by July 1, 1984, and $10,000 due by April 1, 1985 (to be paid to the partnership and passed through to the Glanzers).
- The partnership employed Alan Glanzer for three years with minimum annual compensation of $20,000, $22,000, and $24,000.
- The Glanzers did not receive the $10,000 due by April 1, 1985; about three months later, Alan’s employment was terminated; the partnership entered bankruptcy.
- The Glanzers sued Dehon for multiple tort and contract theories and sought to hold St. Joseph Indian School (Dehon’s parent) liable under veil-piercing (instrumentality/alter ego) and agency theories.
- Evidence offered against St. Joseph included common executives, St. Joseph’s incorporation and capitalization of Dehon, St. Joseph personnel managing the business, Alan’s W-2 listing St. Joseph as employer, wages paid from St. Joseph’s account, and medical insurance provided by St. Joseph.
- The trial court granted summary judgment dismissing St. Joseph; a later jury trial against Dehon resulted in a $120,001 verdict for the Glanzers.

## Issues

1. Whether the record created a genuine issue of material fact that Dehon was an instrumentality/alter ego of St. Joseph such that St. Joseph could be liable for Dehon’s obligations.
2. Whether the record created a genuine issue of material fact that Dehon acted as St. Joseph’s agent with respect to the partnership such that St. Joseph could be vicariously liable.

## Decision

- The Supreme Court of South Dakota reversed summary judgment for St. Joseph and remanded.
- Viewing the evidence favorably to the Glanzers, the court held a fact-finder could infer parent control and operational intermingling sufficient to support veil-piercing.
- The court also held the evidence could support an inference of an agency relationship, making summary judgment inappropriate.

## Legal Principles

- Summary judgment is improper when material facts are genuinely disputed; evidence is viewed in the light most favorable to the nonmoving party, with reasonable doubts resolved against the movant.
- Veil-piercing/instrumentality liability may be imposed where a parent’s dominion and control over a subsidiary and the circumstances make it unjust to treat the entities as separate.
- Facts such as incorporation and capitalization by the parent, common executives, shared personnel, and intermingled financial/operational arrangements can support an inference of instrumentality sufficient to require trial.
- Agency may be proved by circumstances showing authorization, control, or holding out; agency questions are commonly for the fact-finder when competing inferences are reasonable.

## Conclusion

Because the record contained substantial evidence of St. Joseph’s involvement in Dehon’s formation, management, and financial arrangements related to the partnership, genuine issues of material fact existed on both veil-piercing and agency theories, requiring reversal of summary judgment and remand for further proceedings.


Glanzer v. St. Joseph Indian Sch., 438 N.W.2d 204 (S.D. 1989)