We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Abuse of Separate Entity lifting the corporate veil - Essay Example

Comments (0) Cite this document
Summary to essay on topic "Abuse of Separate Entity lifting the corporate veil"
A company incorporated under the Companies Act has invariably been regarded as a separate entity as distinct from its shareholder. Though several legal pronouncements had reiterated this point, the decision in the case of Salomon V Salomon & Co [1897] AC 22 had been a landmark decision to stress this point…
Download full paper
Polish This Essay
Abuse of Separate Entity lifting the corporate veil
Read TextPreview

Extract of essay "Abuse of Separate Entity lifting the corporate veil"

Download file "Abuse of Separate Entity lifting the corporate veil" to see previous pages... the liabilities contracted on behalf of the company. Under normal circumstances the creditors of the company can have recourse for their dues against the assets of the company and they cannot attach the liability to the personal assets of the shareholders. Under certain circumstances it may become necessary for the company to fix up the responsibility on individuals in respect of some liabilities contracted by them on behalf of the company.
Let us write or edit the essay on your topic "Abuse of Separate Entity lifting the corporate veil" with a personal 20% discount.. Try it now
The exact circumstances under which the courts will 'pierce the corporate veil' as it is technically known, depends on the state laws. However in general under the following circumstances the courts will look beyond the corporate veil phenomenon and provide a remedy to the creditors.
Where the circumstances are such that the shareholder has lost the privilege of limited liability and has become liable personally to the creditors. This situation may arise when the company continued to carry on the business for a period of six months after the number of its members was reduced below the minimum as prescribed by law with the knowledge of the shareholder
Under the common law courts would allow the lifting of the corporate veil only in cases where the company is a 'mere facade concealing the true facts', or, in the parlance of earlier cases, a mere 'sham', Gower,LCB (1992)
However the circumstances under which the courts will find such a 'faade' or 'sham' are considered to be very rare. In the case of
Woolfson v StratchclydeRegional Council, 1978 SLT 159 at 161:the House of Lords observed that the corporate veil can be pierced only where special circumstances exist to indicate that the company is a mere faade concealing true facts. "The recent decision of the Court of Appeal in China Ocean Shipping Co v Mitrans Shipping Co Ltd, (1995) 3 HKC 123appears to have narrowed the already limited circumstances in which a court will lift the corporate veil." Following the ruling of this case if a person uses the corporate veil to protect him from legal obligation prior to the arising of the legal obligation then the corporate veil will not be pierced. On the contrary if the person uses the corporate veil to protect him after the legal obligation is established then the corporat ...Download file "Abuse of Separate Entity lifting the corporate veil" to see next pagesRead More
Cite this document "Abuse of Separate Entity lifting the corporate veil"
  • APA
  • MLA
  • CHICAGO
(“Abuse of Separate Entity lifting the corporate veil Essay”, n.d.)
Abuse of Separate Entity lifting the corporate veil Essay. Retrieved from https://studentshare.org/miscellaneous/1506034-abuse-of-separate-entity-lifting-the-corporate-veil
(Abuse of Separate Entity Lifting the Corporate Veil Essay)
Abuse of Separate Entity Lifting the Corporate Veil Essay. https://studentshare.org/miscellaneous/1506034-abuse-of-separate-entity-lifting-the-corporate-veil.
“Abuse of Separate Entity Lifting the Corporate Veil Essay”, n.d. https://studentshare.org/miscellaneous/1506034-abuse-of-separate-entity-lifting-the-corporate-veil.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document
CHECK THESE SAMPLES - THEY ALSO FIT YOUR TOPIC "Abuse of Separate Entity lifting the corporate veil"
Law for Managers- Lifting the Corporate Veil
This essay seeks to critically analyse the circumstances under which the corporate veil can be lifted as well as analysing the effectiveness of the law in piercing this veil when necessary. The essay starts by outlining the overview of the concept of legal personality through analysing different court cases that have influenced the development of the law and the decisions made by the courts.
11 Pages(2750 words)Essay
Lifting the Corporate Veil
The effect of the decision was that creditors of a company that had gone insolvent would not be able to sue the shareholders of the company for its outstanding debts: the doctrine of separate corporate personality was effectively entrenched by the House of Lords.
10 Pages(2500 words)Essay
Lifting the Corporate Veil
More significantly, the House of Lords enshrined the notion that the company exists as a separate entity from its members – the company therefore took on its own personality, capable of being sued and of taking legal action,3 of entering into contracts, of owning its own property, and of making profits and suffering losses.
6 Pages(1500 words)Coursework
Lifting the Veil- Prest V Petrodel
As such, the paper starts by outlining the meaning of corporate veil and this will be followed by a critical analysis of the case drawing examples from different case laws and statutes related to this topic. According to Cillers et al (2004), the association of persons or an organised body can acquire legal personality by way of separate Act.
7 Pages(1750 words)Essay
Corportions Law in Australia
The members of a limited company are only liable to contribute towards payment of its debt to a limited extent. No member can be called upon to pay anything more than the unpaid value of the shares held by him or the amount guaranteed by him. This is called limited liability1 (biz/ed).
6 Pages(1500 words)Essay
Corporate Group Structure
But there have also been a spate of corporate scandals such as Enron, Maxwell Insurance and others, which have shown how subsidiary organizations are sometimes used as a means to escape liability for the financial consequences of risky decisions. They have functioned as entities where parent companies are able to deflect their risks and liabilities.
16 Pages(4000 words)Essay
Company Law
ypothesi a distinct legal persona’2 and ‘the company is at law a different person altogether from the subscribers to the memorandum…nor are the members as subscribers liable…except to the extent and in the manner provided by the Act.’3 From the decision of Salomon
8 Pages(2000 words)Essay
Corporate Group Structures
buse of corporate status by parent companies.”3 Critical analysis of the corporate group structure and the validity of this statement will be examined. Particular attention will be paid to the relationship of a parent company to its subsidiary and of any potential liability a
22 Pages(5500 words)Essay
Outline and critically discuss the statutory and common law examples of 'lifting the veil' on corporate personality
nd limited liability was confirmed by the ruling in Salomon v Salomon and Company.2 However, there are exceptions to the corporate shield under both statutory and common law. This paper analyses some examples where the corporate veil can be lifted under both common law and
10 Pages(2500 words)Essay
What is meant by piercing the veil of incorporation Using examples from the case law, consider critically some of the different reasons why it might be thought appropriate to pierce the veil. Explain why the doctrine has been controversial and cons
To this end, the paper examines the doctrine of the “piercing of the veil of incorporation” by reviewing and evaluating elements from case law. The central case in English law that provides an
9 Pages(2250 words)Essay
Let us find you another Essay on topic Abuse of Separate Entity lifting the corporate veil for FREE!
Contact us:
+16312120006
Contact Us Now
FREE Mobile Apps:
  • About StudentShare
  • Testimonials
  • FAQ
  • Blog
  • Free Essays
  • New Essays
  • Essays
  • The Newest Essay Topics
  • Index samples by all dates
Join us:
Contact Us