...Company Law 2.1.1 Separate Legal Personality of a Registered Company Currently at Page & Plant, neither person has been able to reach an agreement as to how their business should be organised. Under Scottish business law, their current business relationship would be classified as a Partnership, which results in both partners being liable for any situation e.g. account defaults, liquidation or lawsuits. Not only would the liability extend to the assets of the business but would also include personal assets e.g. their homes and cars. In order for Page & Plant to limit or minimise their liability, they must separate the legal personality and legal consequences of the business. In order to do this, Page & Plant can become a registered company as a corporate body. They must be incorporated under the Companies Act 2006 or previous company legislation. Private and Public Limited companies must be registered under the Companies Act in order for the company to become an independent legal person which means the registered company becomes a person capable of taking on duties recognised and enforced by courts. A separate corporate personality means: * The company is able to raise its’ own legal actions and be the subject of legal actions * The company’s members enjoy limited liability * Even with changes to the company’s membership, the company continues to exist, as opposed to a sole trading business or partnership, as the business would change in these...
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...Neyamul Hoque ID:1020180530 Sec:8 LAW 200 Statement Analysis: “A company at law is distinct from its members. A Director is neither an agent nor a trustee of a company” To: Barrister Shaheen Ahmed (ShD) Date: 07.04.2014 Introduction The main inspiration for forming a corporation or company is the limited liability it offers to its shareholders. This policy allows the shareholders to lose only what he has contributed as shares to the corporate entity and nothing more. However, there is a major exception to the general concept of limited liability. There are certain circumstances in which courts will have to look through the corporation, that is, lift the veil of incorporation, and hold the shareholders of the company personally liable for the obligations of the corporation. The veil policy is raised when shareholders shape the distinction between the corporation andthe shareholders. It is an important aspect of the law that although it is a separate legal entity, a company or corporation can only act through human agents that it is comprised of.Under the company law or corporate law, a corporation is specifically referred to as a legal person who is a subject to rights and duties and is capable of owning real property, entering into contracts, and having the...
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...Adjunct Faculty, Department Of Bachelor of Business Administration, East West University. Without him, preparing this report would be simply impossible for us. We also like to thank our seniors and classmates to giving advices and reliable information. We are paying our hearties appreciation to all of these people for their great co-operation, which will be always remembered by us. Letter of transmittal 22 April, 2010 K.I.M.MANZUR-E-MAWLA Adjunct Faculty Department of Business Administration East West University Dear Sir For the purpose of understanding the company law and corporate personality in the real life scenario and what are the cases that influence the company law. Therefore we have prepared a report on Company: A Corporate Personality. It is our honor to transmit to you the report and grateful to you for giving us the chance to prepare this report being a part of course works Legal Environment of Business (BUS 361). In spite of various limitations, we did our best to put rational analysis in this report through our collective effort. We hope that you will find some...
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...PIERCING THE CORPORATE VEIL: ITS LEGAL AND JUDICIAL RECOGNITION IN ETHIOPIA Endalew Lijalem Enyew ♣ Abstract: Upon acquisition of legal personality a company enjoys certain attributes such as limited liability. While the separate legal personality of a company enables it to enjoy rights and assume obligations quite different from its members, the limited liability of shareholders refers to the fact that the company alone is liable for its debts. However, such privilege of limited liability may not always exist when the legal personality of a company is abused and used for illegitimate or unlawful purposes and other reasons. This article examines some of the grounds by which the corporate veil can be pierced under Ethiopian law and the role of courts in recognizing the doctrine. Based on the analysis of the relevant legislative provisions and some court cases, it is found that Ethiopian company law, though not sufficient, provides some clear grounds of piercing the corporate veil and certain possible grounds which may call for the application of the doctrine. It is also argued that Ethiopian courts should apply the doctrine of piercing the corporate veil, through the purposive interpretation of the statutory provisions, if doing so produces equitable results and fairness. Key Words: Company, corporate veil, piercing the veil, Ethiopia DOI http://dx.doi.org/10.4314/mlr.v6i1.3 _____________ Introduction The separate legal personality of a company renders it a juridical person...
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...derived from the Latin word Corpus which also means body. A corporation is therefore a legal person brought into existence by a process of law and not by natural birth. Owing to these artificial processes they are sometimes referred to as artificial persons, not fictitious persons. Company law can be described as the body of laws and rules that govern companies created under the United Kingdom Companies Act of 2006 (hereafter referred to as the Act of 2006). Section 1(1) of the Companies Act of 2006 states; “what company means as a corporation that is created, formed and registered under the aforementioned Act, which is one that was registered after such commencement of the Part in the Act or before such commencement.” It can also be one that came into existence under the U.K Companies Act of 1985, or the Companies (Northern Ireland) Order of 1986, or was a company in existence for the purposes of any of the Acts or Order, and is thus to be treated as if created by the act (Companies Act 2006). This is however a very vague definition. In the statute, the word company is not a legal term hence the vagueness of the definition. The legal attributes of the word company will depend upon a particular legal system. In legal theory, a company denotes an association of a number of persons for some common object or objectives. In ordinary usage it is associated with economic purposes or gain. A company can be defined as an association of a group or several persons who contribute money...
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...2014 Assignment Topic “The Company at Law is Distinct from its Members. Directors are neither Agents nor Trustees of the Company” Prepared For Barrister Shaheen Ahmed Lecturer School of Business North South University Prepared By Shahriar Hasnaine Sakib ID- 111 0261 030 LAW 200 Section: 07 Date of Submission July 15, 2014 Contents TABLE OF CONTENTS Objective 3 Introduction 3 Company’s Classification and Characteristics 3 Separate legal personality 4 Consequences of treating the company as a separate legal entity: 5 Company has a Distinct Entity from its Members 6 Agent & Trustee 6 Directors 6 Analysis to the Leading Cases 7 Salomon v. Salomon & Co. 7 Lee and Lee’s Air Farm’s Ltd 8 Macaura v. Northern Assurance Co Ltd 8 DHN v Tower Hamlets London Borough Council 9 Lubbe v Cape Plc [2000] 9 Some Other Famous Cases: 10 Paul v. Virginia (1869) 10 Berkey v. Third Avenue Railway Co 10 Adams v Cape Industries plc [1990] 10 Walkovszky v. Carlton 10 Findings 11 Conclusion 11 Bibliography 12 Objective ‘’A company is distinct from its members. Directors are neither agents nor trustees of a company’’ The purpose of this Assignment is to analyze the legendary statement made by Lord Mac Naughton during the Salomon vs Salomon case on corporate personality, in the lights of some leading cases. The statement of Lord Mac Naughton was “The Company is at law a different person altogether from its members, the company is not in law agent of the subscribers...
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...Introduction: Companies are the dominant form of business association. The fundamental concept of company law was developed based on a case decided more than 100 years ago in the UK’s House of Lords. The case of Salomon established a maxim that a company is a separate legal entity distinct from its members. When a company is formed, it is said to have become “incorporated”. Thus it is a separate legal entity or a legal ‘person’ it has features that have given a company certain capabilities under the realm of law. The capabilities would include employing personnel, making contract, owning property, paying taxes and so on. A company can also sue and can be sued. Under the eye of the law, anything that is capable of rights and duties is a person and thus has a personality. Persons can be of two types under the eye of law (i) natural persons and (ii) artificial persons. Natural persons are human beings and artificial persons are those created for the purpose of laws known as corporations or companies. As soon as a company is registered under the company act, it attains the status of a person that can buy, lend money, file and defend suit, sell goods and hold property. One of the major features of a corporation from the very beginning is that the owners/shareholders enjoyed limited liability, which means, the owners were not liable for the debts of the company. Before the industrial Revolution it was only the persons who could be sued or sue. Thus, when a corporation breached a...
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...Differences between private and public companies 3 Registration Procedures 3 Concept of separate Legal Personality 3 Conclusion 4 Terms of Reference Charles Prospect has requested a report on the areas of law that deals with the registration of private and public limited liability companies. The completed report is to be submitted on the 10th Oct 2014. The report will cover the types of corporate bodies that can register in the UK, the differences between private and public companies and their characteristics, the concept of separate legal personality and the registration procedures and supporting documentation. Procedure In order to complete this report the following research was carried out: Internet research/Companies House/Company Law Club and Law Teacher Findings A company is an association of a number of persons, formed for some common purpose and registered according to the procedures laid out under the Companies Act 2006. Two models can be registered in the United Kingdom: Private companies that are limited by shares - This type of company/Business issues shares and its members have limited liability. Limited Liability means that if the business fails the members liability is limited to the value of their unpaid shares. Public companies limited by shares - This type of company works in the same way that a private limited company does in the way of offering shares to its members, however unlike a Ltd a Public company can sell shares off to members of...
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...CONTENTS Introdcution ...................................................................................................................................................................2 Definition of a Company ............................................................................................................................................2 Features of a Corporation ..........................................................................................................................................3 Difference Between a Company and Its personnel .......................................................................................................4 Shareholders ..............................................................................................................................................................4 Directors ....................................................................................................................................................................4 Directors as agent: .................................................................................................................................................5 Directors as Trustees: ............................................................................................................................................5 The Veil of Incorporation ............................................................................................................................
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...INTRODUCTION This unit introduces students to the most common forms of business organizations, namely sole proprietorship, partnership and limited liability companies. However, emphasis is placed here on partnership and the legal consequences which flow from the formation of such a method. The main advantages and disadvantages of these forms of business organizations are also discussed. Important Concepts in Business Organizations The following are some important concepts in business organizations: Incorporation The law permits the creation of artificial or legal persons. An example of such is an incorporated company. This means that such an organization has a legal personality separate from its members. Legal Personality Under The English Law, all human beings have a legal personality. A legal personality is made up of a person’s legal rights and duties. However, the extent of these rights and duties is dependent on whether the person is an adult or a minor. A minor has limited rights and few duties. By operation of the law, an incorporated company has a legal personality Limited/unlimited Liability As a result of an incorporated organization having its own legal personality, its members are not generally liable for the debts of the organization. This however is in contrast to a partnership which does not have a legal personality separate from the partners. Here, partners have unlimited liability for partnership’s debts. Also, a sole proprietor has unlimited liability...
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...Overview * Introduction to and sources of Company Law (2) * Types of companies – General characteristics (7) * Formation of a company (13) * Capital (19) * Financing of company * Corporate Bodies * General meeting * Control * Annual Corporate Compliance * Director’s liabilities * Restructuring of companies * Liquidation of companies * Continuity * Draft questions exam Introduction to and sources of company law Sources When I start up a business in Belgium, whether I’m Belgian or my foreign company locates a subsidiary here, which legislative rules should I take into account? Which legislation can accurately tell me what to do and what not to do? There are four sources of legislation for Belgian companies: the Belgian Company Code, the Jurisprudence, the Doctrine and the European Directives. The Company Code The Company Code is a legislation code that was adopted by the Belgian Parliament on the 7th of May in 1999, which regroups and restructures the main provisions of Belgian Company Law. For decades, authors and practitioners had been complaining about the complexity of the Belgian Company Law. There were far too many sources to it. What they wanted was one and only one book with all the provisions concerning the Belgian Company Law. So by adopting the Company Code, the legislator didn’t have as main objective...
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...of corporate separate personality. The fundamental concept of corporate separate personality recognises that a company, once incorporated, becomes a ‘body corporate’, i.e. a legal entity distinct from its members and officers. The various effects of corporate separate personality shall be dealt with in turn. 1) Distinct legal identity from its members One of the most significant effects of corporate separate personality is that the company assumes a separate identity from that of its members. Even if a company is owned outright by one shareholder, the company has a completely separate personality from that individual. This is confirmed by the leading case of Salomon v A. Salomon & Co Ltd in which the House of Lords held that the company’s acts were its own acts, not those of Mr Salomon personally. As a result, Mr Salomon was not personally liable for his company’s debts. It is worth noting, however, that the Court did recognise that there would be situations in which they would be prepared to move away from that principle and ‘lift the veil of incorporation’ and find individuals liable where they had acted dishonestly, fraudulently or unreasonably. 2) Limited liability Due to the fact that the company is a separate legal individual, it follows that its members will not generally be liable for its debts and obligations. This gives the shareholders a great level of security, since it means that they are able to profit from the successes of the company whilst being safe in the...
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...Mercantile society mercantile society (or commercial society ) is that one society that intends the one accomplishment or more transactions commercial or, generally, a subject activity to Straight mercantile . Civil society is against to . Like all society, they are beings which the law recognizes legal Personality own and different from its members, and that also counting on own Patrimony, canalizes their efforts to the accomplishment of a lucrative purpose that are common, with vocation like the benefits that are from the realized activities, will be only perceived by the partners. Antecedents The old one straight did not know Institution mercantile society with legal personality, the one that is creation of the modern world. Decrees of Bilbao only regulated the collective societies and the silent partners. Elements In the Mercantile Societies there are three fundamental elements: the social ones, patrimonial and the formal ones: • Personal element: It is constituted by the partners, people who contribute and reunite their efforts (goods, capitals or works) • Patrimonial element: It is formed by the set of goods that are contributed to form the share capital, the goods, work, etc. • Formal element: It is the set of rules regarding the form or solemnity with which one is due to have to the contract that gives rise to the society like a right individuality. Classification The mercantile Societies can be classified according to several criteria, between...
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...------------------------------------------------- ------------------------------------------------- ------------------------------------------------- OPERATORS OF INTERNATIONAL BUSINESS LAW ------------------------------------------------- The operators in the international contract The parties can be natural person, companies, states and public entities. Section I: The natural persons and international trade They intervene in their own account and also as an agent. 1. The capacity and power of attorney ( mandat) To intervene on his own account or on behalf of a third person, the person must be an adult or adult under guardianship or trusteeship. If the person intervenes on behalf of a third or as an agent, he needs a power of attorney. The capacity: it is governed by the person’s national law, the law of the country where the disputed act ( l’acte litigieux) is concluded ; or by the applicable law to the contract. * In France, the capacity is governed by the national law even if the person lives abroad (article 3 CC). If the person is a foreigner, his capacity depends on his own national law. Example: If the person is underage according to his national law but adult in France, the contract are legal if his French partner acted in good faith. * In the common law system , the capacity is governed at the contract’s law * In Switzerland, Germany or Italy, the capacity depends on the place where the contract is made. ( same for international law , The convention of Rome of June 19...
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...Running Head: Business Law Business Law Oweya Vincent Makaya University of Nairobi THE COMPANY AS A JURISTIC PERSON VERSUS RESPONSIBILITY FOF THE DIRECTOR’S ACTIONS. Introduction: For a very long time a company has been treated as a corporate entity or a juristic person. In fact the concept of limited liability stems from this premise. Despite being an artificial person a company is wholly a creature of human beings, by human beings and for human beings. It solely rely on humans to conduct and transact any business. This research paper seeks to examine the concept of juristic personality, its advantages and its relationship with its owners. It delves into how decisions are made by this juristic personality, its liabilities and liabilities of those running it. The paper shall seek to examine if this veil of juristic person exists permanently or it can be lifted. What are the consequences of lifting that gown of juristic personality? The Concept of juristic personality. Companies and corporations are said to be legal or juristic personalities. This arises from the incorporation process. A corporation is a word that is said to have been derived from a Latin word corpus which means among other things “body”. An incorporated body becomes what is known as a “corpora coporata” in Latin or corporate body. The idea of a juristic person in law refers to an entity recognized in law as an artificial person. What this means is the entity recognized...
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