Limited liability, usually regarded as the most significant feature of corporate enterprise, has received extravagant praise. Among those who have paid verbal homage to the concept of limited liability are two former university presidents who cut a large figure in the intellectual manners of the nation during the last half century. President Eliot of Harvard regarded limited liability as "the corporation's most precious characteristic" and "by far the most effective legal invention . . . made in the nineteenth century."l President Nicholas Murray Butler of Columbia made the pronouncement in I9II: "I weigh my words when I say that in my judgment the limited liability corporation is the greatest single discovery of modern times.... Even steam and electricity are far less important than the limited liability corporation, and they would be reduced to comparative impotence without it."2 Our courts have rested-unnecessarily, it is believed3-the concept of limited liability on the legal entity theory. This theory, familiar to every elementary student of corporation law and finance, treats the corporation as a legal persona or juristic person constituting an entity in itself separate and distinct from the members. The essence of this theory, stated in stark terms, is that the shareholders own "the corporation" and the latter owns and operates the assets and the business. The questionable4 but judicially accepted reasoning which regards limited liability as a