 IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

 MAPLE VALLEY PARK PLACE, LLC, a
 Washington Limited Liability Company,             DIVISION ONE

                        Appellant,                 No. 78832-9-I

                 v.                                UNPUBLISHED OPINION

 TAX RESOURCE CENTERS, INC., a
 Washington for-profit corporation; and
 EDWARD J. HARRIS and “JANE DOE”
 GAIL HARRIS and their marital
 community,

                        Respondents.

          DWYER, J. — Maple Valley Park Place, LLC (MVPP) seeks reversal of a

trial court ruling that MVPP failed to establish the necessity of piercing the

corporate veil, which prevents MVPP from executing a prior default judgment

against Edward Harris individually. Because MVPP’s contentions lack merit, we

affirm.

                                          I

          Edward Harris is an accountant authorized to represent taxpayers before

the Internal Revenue Service. From 2000 to 2016, Harris operated a tax

preparation corporation, Northwest Tax Specialists, Inc. (NTS). In 2014, on

behalf of NTS, Harris entered into a lease agreement for office space with MVPP.

Although it had been a standard practice for MVPP to require renters to sign a

personal guaranty, it did not require Harris to sign one.
No. 78832-9-I/2


       Then, in April 2015, Harris informed MVPP that NTS would be unable to

make its rental payments and sought to negotiate a termination of the lease. RP

161. Negotiations stalled. NTS moved out of the leased offices and ceased

making rental payments in June 2015. MVPP sent two notices of default to NTS,

but NTS did not attempt to cure the default.

       MVPP subsequently filed suit against NTS, seeking to recover the unpaid

rent. NTS did not appear to defend the suit. In May 2016, a default judgment

was entered against NTS in the amount of $523,804.33. MVPP attempted to

collect the judgment, but never received any of the money owed by NTS.

       Later that year, Harris, realizing that NTS could not recover from its

outstanding debts, closed NTS and started a new business, Tax Resource

Centers, Inc. (TRC), using a combination of personal funds and resources from

NTS.

       MVPP then filed a second lawsuit against TRC and Harris. MVPP argued

that TRC and Harris should be liable to pay the default judgment because (1)

TRC was a successor in liability to NTS and (2) Harris had abused the corporate

form while operating NTS and it was necessary to pierce the corporate veil to

ensure MVPP could collect on its default judgment.

       A bench trial was held in King County Superior Court. After the close of

the evidence and argument of counsel, the trial judge entered findings of fact and

conclusions of law. Therein, the trial court concluded that (1) TRC was the

successor in liability to NTS and (2) although MVPP established that Harris had

abused the corporate form, MVPP had not established the necessity of piercing




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the corporate veil because MVPP could collect on its default judgment from TRC.

The trial court invited MVPP to “present a proposed judgment that is consistent

with these Findings of Fact and Conclusions of Law.”

        However, instead of presenting such a proposed judgment, MVPP filed a

notice of appeal stating that it was appealing from the trial court’s findings of fact

and conclusions of law. In response, this court directed MVPP to present a

proposed judgment to the trial court. Pursuant to RAP 7.1(a) and 8.3, we

authorized the trial court to enter a judgment consistent with its previously

entered findings of fact and conclusions of law. MVPP then filed a proposed

judgment and the trial court entered judgment against TRC and dismissed, with

prejudice, MVPP’s cause of action against Harris.1

                                                II

        MVPP contends that the trial court erred when it concluded that the

corporate veil could not be pierced in order to hold Harris personally liable for the

payment of the default judgment against NTS. This is so, MVPP asserts,

because (1) the trial court improperly refused to consider whether Harris’s

violations of RCW 23B.06.400 and RCW 19.40.051 established the necessity of

piercing the corporate veil and (2) substantial evidence established the necessity

of piercing the corporate veil.2 We disagree.


        1 Because judgment has been entered, we need not address the parties’ contentions
regarding whether MVPP may appeal from the trial court’s findings of fact and conclusions of law
absent entry of a final judgment.
        2 Inexplicably, MVPP asserts both that the trial court erroneously ruled that MVPP had

not established the necessity of piercing the corporate veil and that the trial court erred by not
making any findings or ruling on whether necessity was established. The trial court’s findings of
fact and conclusions of law directly stated that necessity was not established because MVPP did
not prove “that Mr. Harris’s transfer of [NTS]’s assets and business to TRC, or that the
continuation of [NTS]’s business by TRC, will have any substantial detrimental effect on [MVPP]’s


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No. 78832-9-I/4


        We review a trial court’s findings of fact under a substantial evidence

standard, “defined as a quantum of evidence sufficient to persuade a rational fair-

minded person the premise is true.” Sunnyside Valley Irrig. Dist. v. Dickie, 149

Wn.2d 873, 879, 73 P.3d 369 (2003). We then determine whether those findings

of fact support the trial court’s conclusions of law. W. Coast, Inc., v. Snohomish

County, 112 Wn. App. 200, 207, 48 P.3d 997 (2002) (citing Landmark Dev., Inc.

v. City of Roy, 138 Wn.2d 561, 573, 980 P.2d 1234 (1999)). Unchallenged

findings of fact are considered verities on appeal. W. Coast, Inc., 112 Wn. App.

at 207 (citing State v. Hill, 123 Wn.2d 641, 644, 870 P.2d 313 (1994)).

“Questions of law and conclusions of law are reviewed de novo.” Sunnyside

Valley Irrig. Dist., 149 Wn.2d at 880.

        To pierce the corporate veil, a party must establish that (1) the corporate

form was intentionally used to violate or evade a duty, and (2) piercing the veil is

“‘necessary and required to prevent unjustified loss to the injured party.’” Meisel

v. M & N Modern Hydraulic Press Co., 97 Wn.2d 403, 410, 645 P.2d 689 (1982)

(quoting Morgan v. Burks, 93 Wn.2d 580, 587, 611 P.2d 751 (1980)).

        MVPP first asserts that the trial court improperly refused to consider

whether violations of RCW 23B.06.400 and RCW 19.40.051 established the

necessity of piercing the corporate veil. Because neither of these statutes has




ability to collect [NTS]’s obligation from TRC if a judgment is rendered in [MVPP]’s favor and
against TRC in this case.” We therefore reject MVPP’s assertions that the trial court did not enter
necessary findings or conclusions regarding the necessity of piercing the corporate veil.
          Furthermore, we note that the relief requested in MVPP’s briefing is that we remand to
the trial court to enter findings and conclusions regarding whether necessity was established.
Because the trial court already entered such findings and conclusions, MVPP has already
obtained its requested relief.


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No. 78832-9-I/5


any bearing on the necessity of piercing a corporate veil, we reject this

contention.

       RCW 23B.06.400 sets forth rules regarding the distributions a corporation

may make to its shareholders.3 It specifically bars distributions that, if made,



       3 This section states, in full:
                  (1) A board of directors may approve and the corporation may make
       distributions to its shareholders subject to restriction by the articles of
       incorporation and the limitation in subsection (2) of this section.
                  (2) No distribution may be made if, after giving it effect:
                  (a) The corporation would not be able to pay its liabilities as they become
       due in the usual course of business; or
                  (b) The corporation’s total assets would be less than the sum of its total
       liabilities plus, unless the articles of incorporation permit otherwise, the amount
       that would be needed, if the corporation were to be dissolved at the time of the
       distribution, to satisfy the preferential rights upon dissolution of shareholders
       whose preferential rights are superior to those receiving the distribution.
                  (3) For purposes of determinations under subsection (2) of this section:
                  (a) The board of directors may base a determination that a distribution is
       not prohibited under subsection (2) of this section either on financial statements
       prepared on the basis of accounting practices and principles that are reasonable
       in the circumstances or on a fair valuation or other method that is reasonable in
       the circumstances; and
                  (b) Indebtedness of a corporation, including indebtedness issued as a
       distribution, is not considered a liability if its terms provide that payment of
       principal and interest are made only if and to the extent that payment of a
       distribution to shareholders could then be made under this section.
                  (4) The effect of a distribution under subsection (2) of this section is
       measured:
                  (a) In the case of a distribution of indebtedness, the terms of which
       provide that payment of principal and interest are made only if and to the extent
       that payment of a distribution to shareholders could then be made under this
       section, each payment of principal or interest is treated as a distribution, the
       effect of which is measured on the date the payment is actually made; or
                  (b) In the case of any other distribution:
                  (i) If the distribution is by purchase, redemption, or other acquisition of
       the corporation’s shares, the effect of the distribution is measured as of the
       earlier of the date any money or other property is transferred or debt incurred by
       the corporation, or the date the shareholder ceases to be a shareholder with
       respect to the acquired shares;
                  (ii) If the distribution is of indebtedness other than that described in
       subsection (4) (a) and (b)(i) of this section, the effect of the distribution is
       measured as of the date the indebtedness is distributed; and
                  (iii) In all other cases, the effect of the distribution is measured as of the
       date the distribution is approved if payment occurs within one hundred twenty
       days after the date of approval, or the date the payment is made if it occurs more
       than one hundred twenty days after the date of approval.
                  (5) A corporation’s indebtedness to a shareholder incurred by reason of
       a distribution made in accordance with this section is at parity with the


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No. 78832-9-I/6


would prevent the corporation from being able “to pay its liabilities as they

become due in the usual course of business.” RCW 23B.06.400(2)(a). Nothing

in RCW 23B.06.400 addresses the issue of the necessity of piercing the

corporate veil. Thus, a violation of the statute plainly has no bearing on the

necessity of piercing the corporate veil.

        Similarly, RCW 19.40.051 sets forth rules regarding when transfers to

creditors are voidable.4 This section declares that a transfer made by a debtor is

voidable

        as to a creditor whose claim arose before the transfer was made or
        the obligation was incurred if the debtor made the transfer or
        incurred the obligation without receiving a reasonably equivalent
        value in exchange for the transfer or obligation and the debtor was
        insolvent at that time or the debtor became insolvent as a result of
        the transfer or obligation.




      corporation’s indebtedness to its general, unsecured creditors except to the
      extent provided otherwise by agreement.
                (6) In circumstances to which this section and related sections of this title
      are applicable, such provisions supersede the applicability of any other statutes
      of this state with respect to the legality of distributions.
                (7) A transfer of the assets of a dissolved corporation to a trust or other
      successor entity of the type described in RCW 23B.14.030(4) constitutes a
      distribution subject to subsection (2) of this section only when and to the extent
      that the trust or successor entity distributes assets to shareholders.
RCW 23B.06.400.
      4 This section states, in full:

                (1) A transfer made or obligation incurred by a debtor is voidable as to a
      creditor whose claim arose before the transfer was made or the obligation was
      incurred if the debtor made the transfer or incurred the obligation without
      receiving a reasonably equivalent value in exchange for the transfer or obligation
      and the debtor was insolvent at that time or the debtor became insolvent as a
      result of the transfer or obligation.
                (2) A transfer made by a debtor is voidable as to a creditor whose claim
      arose before the transfer was made if the transfer was made to an insider for an
      antecedent debt, the debtor was insolvent at that time, and the insider had
      reasonable cause to believe that the debtor was insolvent.
                (3) Subject to RCW 19.40.021(2), a creditor making a claim for relief
      under subsection (1) or (2) of this section has the burden of proving the elements
      of the claim for relief by a preponderance of the evidence.
RCW 19.40.051.


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No. 78832-9-I/7


RCW 19.40.051(1). Once again, a violation of this statute has no bearing on the

issue of the necessity of piercing the corporate veil.

          MVPP next asserts that the trial court erred because substantial evidence

showed the necessity of piercing the corporate veil. We reject this argument

because it both calls for an incorrect application of our standard of review and is

unsupported by the record.

          It matters not whether substantial evidence could have supported findings

different than those made by the trial court. On review, all that matters is

whether substantial evidence supports the findings of fact entered by the trial

court and whether those findings support the trial court’s conclusions of law. W.

Coast, Inc., 112 Wn. App. at 207. Because MVPP never asserts that the trial

court’s findings are unsupported by substantial evidence, we treat them as

verities. W. Coast, Inc., 112 Wn. App. at 207.

          Furthermore, MVPP does not identify any evidence in the record to

support its assertion. All of the evidence cited to by MVPP in its briefing pertains

to the issue of whether Harris abused the corporate form. No evidence identified

by MVPP supports its assertion that it established necessity. Indeed, the record

instead indicates a lack of necessity. Because MVPP prevailed on its successor

liability claim against TRC, it may seek to collect its default judgment against

TRC and need not collect from Harris.

          Because MVPP has failed to establish error in the trial court’s rulings, we

affirm.




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No. 78832-9-I/8


      Affirmed.




WE CONCUR:




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