MERITS OF CORPORATE PERSONALITY
A corporate person (s) is a separate legal business entity created under state laws by an owner or group of owners who become initial shareholders. According to Sec. 3 (1) (ii) of the Companies Act, 1956; a company means a business entity formed and registered under the Companies Act, 1956 or any of the preceding Acts. A Company comes into existence only by registration under the Act, which can be termed as incorporation. Thus, a company is a legal person.
The primary advantage of a corporate form of business is that a corporation is a stand-alone entity, which means you are not personally liable for the assets and debts of the business. Incorporating protects your personal assets from lawsuits, debt collection and other business issues that can arise.
Other merits of a corporate personality are as follows:
1) Independent corporate existence- the outstanding feature of a company is its independent corporate existence. By registration under the Companies Act, a company becomes vested with corporate personality, which is independent of, and distinct from its members. A company is a legal person. The decision of the House of Lords in Salomon v. Salomon & Co. Ltd. (1897 AC 22) is an authority on this principle: It was argued on behalf of the unsecured creditors that, though the co was incorporated, it never had an independent existence. It was S himself trading under another name, but the House of Lords held Salomon & Co. Ltd. must be regarded as a separate person from S.
2) Limited liability- limitation of liability is another major advantage of incorporation. The company, being a separate entity, leading its own business life, the members are not liable for its debts. The liability of members is limited by shares; each member is bound to pay the nominal value of shares held by them and his liability ends there.
3) Perpetual succession- An incorporated company never dies. Members may come and go, but the company will go on forever. During the war all the members of a private company, while in general meeting, were killed by a bomb. But the company survived, not even a hydrogen bomb could have destroyed it (K/9 Meat Supplies (Guildford) Ltd., Re, 1966 (3) All E.R. 320).
4) Common seal- Since a company has no physical existence, it must act through its agents and all such contracts entered into by such agents must be under the seal of the company. The common seal acts as the official seal of the company.
5) Transferable shares- when joint stock companies were established the great object was that the shares should be capable of being easily transferred. Sec 82 gives expression to this principle by providing that “the shares or other interest of any member shall be movable property, transferable in the manner provided by the articles of the company.”
6) Separate property- The property of an incorporated company is vested in the corporate body. The company is capable of holding and enjoying property in its own name. No members, not even all the members, can claim ownership of any asset of company’s assets.
7) Capacity for suits- A company can sue and be sued in its own name. The names of managerial members need not be impleaded.
8) Professional management- A company is capable of attracting professional managers. It is due to the fact that being attached to the management of the company gives them the status of business or executive class.

Structure
Corporations have a required set structure, which helps the business to run more efficiently. Corporations are owned by shareholders who elect a board of directors to support their interests and run the corporation. “Each group has its own set of clearly-defined roles and responsibilities within the corporate framework,” reports Find Law.
Financial Aspects
The well-known and understood stock structure of corporations makes them very attractive to investors of all levels. That same structure allows you to entice new employees by offering them ownership of the company through either stocks or stock options. Corporations exist separately from their owners, so stocks can be freely traded in the market, which means that ownership may constantly change hands, spreading over a large number of people. When a corporation needs to raise capital, they have the option of selling stock in the company.
Related Reading: The Advantages of a Corporation Over a Partnership and Sole Proprietership
Liability and Taxation
“Since a corporation is a separate and distinct legal entity, owners of a corporation are only indebted to the extent of their interest in the corporation,” according to Business Accent. This means that shareholders are not personally liable for any company debt and creditors cannot go after their personal assets for business debts. Similarly, shareholders only pay taxes on any profits paid to them as salaries, bonuses or dividends and the corporation itself pays corporate rate taxes on any additional profits at the lower corporate rate.
Perpetual Existence
The main advantage of a corporation is its perpetual existence. Since the corporation is a separate legal entity from any of its owners, it does not dissolve when one owner leaves. If a shareholder dies, the company may transfer her shares in the same way as any other property, and the corporation is not negatively affected. This also allows a shareholder to disconnect from the corporation by selling all of her shares without ending the corporation. Keep in mind that when deciding to dissolve a company there are procedures and paperwork required.
Disadvantages
While a corporation offers many advantages, those same qualities can also make life more difficult. It costs money to incorporate your business, as “startup, operating and tax costs are not required of most other structures,” reports Business.gov. Corporations have rules to follow and you must adhere to the formalities of organizing and running the company. Increased business regulations lead to a large amount of paperwork required to both incorporate and keep accurate tax, business and monetary records as required by law.
ATTRIBUTES OF A NATURAL PERSON
In jurisprudence, a natural person is a real human being, as opposed to a legal person, which may be a private (i.e., business entity or non-governmental organization) or public (i.e., government) organization.
In many cases, fundamental human rights are implicitly granted only to natural persons. For example, the Nineteenth Amendment to the United States Constitution, which states a person cannot be denied the right to vote based on gender, or Section Fifteen of the Canadian Charter of Rights and Freedoms, which guarantees equality rights, apply to natural persons only. Another example of the distinction between natural and legal persons is that a natural person can hold public office, but a corporation cannot.
A corporation or non-governmental organization can, however, file a lawsuit or own property as a legal person.
CAN A TRADE UNION BE SUED
A trade union, according to Section 1(1) of the Trade Union Act, CAP T14, LFN 2004 is any combination of workers or employers, whether temporary or permanent, the purpose of which is to regulate the terms and conditions of terms of workers, whether the combination in question would not apart from this Act be an unlawful combination by reason of its purposes being in restraint of trade and whether its purposes do or do not include the provision of benefits for its members.
It is an organisational structure devised to bring workers in paid employment together to protect their common interest; ‘an organized association of workers in a trade, group of trades, or profession formed to protect and further their rights and interests.
According to Collins dictionary, a trade union ‘is an association of employees formed to improve their incomes and working conditions by collective bargaining with the employer or employer organizations,’ while the Merriam-Webster unabridged dictionary defines it as ‘an organization of workers formed for the purpose of advancing its members’ interests in respect to wages, benefits, and working conditions.’
From the definitions given above, one can succinctly see that for an association to be rightfully referred to as a trade union, it must be a combination, organisation or association of workers or employers and have its primary purpose to be the regulation of the terms and conditions of employment, see RE Union of Ifelodun Timber Dealers and Allied Workers (1964) 2 All NLR 63. This is predicated on the freedom of association and assembly, as provided for by Section 40 of the 1999 Nigerian Constitution; and this freedom and freewill is supported by Section 12 of the Trade Union Act, Section 9(2) of the Labour Act, Cap LFN 2004 and the International Labour Organisation No 87 Part I. For it to be recognised to carry on business as of right in Nigeria, trade unions require registration to allow for legal recognition. While most of the definitions focus on it being an association of employees, the Nigerian Trade Union Act recognises that a trade union may be an association of employers as well.
Trade unionism is the principle and underlining philosophy that guides and regulates the conduct of unions and unionists. It is, according to the free online dictionary, the principle or system and theory of labour unions. It is the spirit of the trade union and its members that allows for them to unite in achieving their respective goals as a trade union.
Legal Personality is defined as those attributes or characteristics that grant a person or organisation rights and responsibilities under the law. The Law Dictionary defines it as the sum total of an individual’s legal advantages and disadvantages; the lawful characteristics and qualities of an entity. This simply means that legal personality means capacity to posses certain characteristics which the law recognises in a person and/or entity and by virtue of which the law vests in such person and/or entity, powers, rights, duties and obligations.
The Legal Personality of Trade Unions
The legality of trade unions is generally agreed upon to exist and is vested on the trade union upon appropriate registration. It is able to (once it has been registered) carry out any act(s) which are in furtherance to its objects. Thus, according to Igwe & Shell BP & Associated Workers Union v. Shell BP Petroleum Development Corp. Limited, it is unarguably established that a trade union has a legal status to its name upon registration and unregistered trade unions have no recognised legal existence and an action would not be entertained against a defendant who, as at when sued, was not a legal person as established in Agbomagbe Bank Ltd v. General Manager GB Olivant Ltd (1961) 1 All NLR 116.
What is not so clear, however, is the extent of this legal status or specifically, the legal personality (or absence of it) of a trade union and this question has raised so many answers in the justification of each position. Worthy of note is the fact that this argument relates to those trade unions which have been properly registered and recognised under the law.
Legal or corporate personality is vested on a company upon incorporation, making it a juristic person and giving it an entirely different identity from that of its members or directors. This concept was exemplified in the case of Salomon v. Salomon & Co. (1987) A.C 22.
It is the opinion of some that trade unions do not have corporate or legal personalities and very logical arguments have been raised to support this view. The first is that the Trade Union Act does not expressly provide for the legal personality of a trade union, neither does it incorporate registered trade unions.
Another argument lies in the courts with jurisdiction over their issues. While trade union disputes lie of right in the National Industrial Court (NIC), by virtue of Section 19 of the Trade Dispute Act and Section 254C(1)A(a-i) of the 1999 Constitution (3rd Alteration Act 2010) of the Federal Republic of Nigeria, those relating to company law matters are instituted in the Federal High Court. This is with the exception of those disputes involving employers and employees, which go to the NIC. In addition to this, the Companies and Allied Matters Act (CAMA) CAP C20 LFN 2004 does not directly apply to trade unions and registration of a trade union is not done like companies under the CAMA but as prescribed by the Trade Unions Act as seen in the case of Tone River Conservators v. Ash (1829) 10 BS C 349. The provision of CAMA also states that the Act does not apply to trade unions of workers and employers.
Judicially, it was held in Nigerian Civil Service Union (ws) v. Allen (1972) 2 UILR 316 that a trade union does not have legal personality and is not a legal entity; and in Nigerian Stevedores and Dockworkers Union v. Opara (unreported) Suit No P/111/1963, it was held that it is at best a quasi-juristic person or not a juristic person at all.
Also, in Bensor v. Musicians’ Union, [1956] AC 104, where the Lords were divided in their decision, Lord Keith posited that ‘…it is not a legal entity distinguishable at any moment of time from the members of which it is at that time composed.’ This means the members of a trade union are not as distinct as they ought to be from the trade union itself at every point in time to be vested with legal personality. This case overruled the decision in Kelly v. Natural Society of Operative Printers Assistants (1915) 31 TLR 632.
On the flip side, cogent arguments have also been raised to affirm the legal personality of a trade union. This was the view of the learned Obaseki JSC in Nigerian Nurses Association v. Attorney General of the Federation (1981) 11-12 SC 1, 11 and 12. Perhaps the most obvious reason for the argument is the fact that trade unions can sue and be sued in their registered names. This principle is also evident in the following cases: Taff Vale Railway Co v. Amalgamated Society of Railway Servants (1901) AC 426, known simply as the Taff Vale’s case and Okongwu v. Anunobi (1966) LLR 49. This is a major characteristic of corporate personality. It acquires proprietary right to its registered name and as such is free from the vagaries of a representative action that is a major blockade to actions by associations unincorporated.
In Taff Vale’s Case, there was an action which was brought by the Claimant Company in 1901 against the Defendant union. The union had gone on strike and tried to coerce the Claimant to recognise the strike. It was the prior position that one could not sue trade unions as they were not incorporated entities. The House of Lords however held that the capacity of a union to inflict harm on other people and own property vests on it the capacity to be liable in tort for the damage it causes. In the instant case, the damage was the economic loss caused to the Claimant when the employees went on strike, which was in contravention to their contracts of employment. The tort in this case was one of general application. It was the argument of the Claimant that since this law applied to ordinary persons and since the 1871 Act recognized trade unions as legal persons, there was no reason why it should not apply to them. The defence of the union that it could not be sued as it had no status of a person at law failed and the Claimant was successful and was awarded £23,000 and damages, amounting to a total of about £42,000; this case bringing to life the fact that a trade union can sue and be sued in its registered name.
Also, in Road Transport Employers’ Association of Nigeria (RTEAN) Oshogbo Osun state v. National Union of Road Transport Workers (NURTW) Osun state, Siut No. NIC/33/2007 of January 12th, 2010, Fabiyi JCA referred to a trade union as ‘a legal person whose birth and death is determined not by nature but by law on paper, not by implication.’ To this honourable Justice, trade unions have legal personalities.
Apart from its capacity to sue and be sued, trade unions have some other attributes of corporate personality including the requirement for a registered office, by virtue of Section 21 of the Trade Unions Act. It also has the obligation to render annual returns (S. 37), submit an audited account of funds to the Registrar (S. 39) and the fact that it may be convicted and upon conviction is liable to a penalty for the breach of these duties. It also is at liberty to hold property in its name as it is not expressly prohibited as is done for unregistered trade unions by Section 22(4)(a)(i) of the Trade Unions Act. These provisions of Statute, by implication, confer on trade unions legal personalities by granting to them characteristics of incorporated companies with legal personalities.
Also, the position of the two agreeing Judges in Bensor v. Musicians’ Union and some parts of the Judgement as delivered by Lord Keith, who was on the fence on this matter, support the claim that trade unions have legal personalities.
In the case of Union of Post and Telegraphs Workers of Nigeria v. Attorney General of Nigeria (1958) CD/142/58, the court also pronounced legal personality on trade unions. It was contended in this case, that a union was not competent to bring an action in court. This contention was rejected by the court, stating that the disability and legal incapacity of a trade union had been removed and it had been conferred with ‘all powers of a persona juridica’. (‘juristic person’; a person under the law). In the case, the decision in Taff Vale’s Case was also cited in support of the view taken by the court that the trade union has legal personality.
The characteristics of registered companies with legal personality being vested on a trade union is another reason why the legal personality of a trade union is argued affirmatively. In Amalgamated Society of Railway Servants v. Osborne, (1910) AC 87, the doctrine of ultra vires was applied to a trade union; and in National Union of General and Municipal Workers v. Gillian (1946) KB 81, it was held that a trade union could be defamed as it had character capable of being defamed. Also in Okongwu v. Anunobi & 5 others, the Plaintiff applied to become a member of the Nigerian Challenge African Staff Association. Upon a dispute arising, it was argued that a trade union though registered, was not a legal entity. This contention was not admitted, making the position that a registered trade union has been accorded the status of a legal person more explicit.
The omission of the sections of the (now repealed) English Trade Union Act of 1871, (this Act was adopted in Nigeria as the Nigerian Act was modeled after it) which provided for Trustees to hold property on the behalf of the union is another pointer to the intention that trade unions have been vested with legal personality, hence there is no need for trustees to hold their property as the trade unions are empowered to do so themselves in their registered name.
Upon due consideration of both positions, it is not a fallible statement to posit that both sides are well-grounded arguments, each with its own merits and backing of case law and law in practice. However, I am more inclined to the position that a trade union has a legal personality.
A trade union, having its registered name and office and identity separate from that of its members has the essential features of a legal entity, added to the fact that it can institute an action and be sued in its own name and not in the name of one of its members.
Furthermore, the granting of legal personality has been predicated on allowing a person or entity have equal or similar status as that of a human being. One of the major characteristics which shows a person or entity’s capacity to be legally recognised especially in court is to hold property independently. These attributes are possessed by trade unions, showing further that they do possess legal personalities.
The following quote was taken from an article by Peter Costello, ‘…trade unions were soon to find out that privileges bring obligations. If trade unions were entities recognized by the law, they could be sued in the same way as other legal persons…’ From this quote, one should note the use of the words ‘other legal persons’ which supports the position that a trade union is a legal person.
I would add that we should be wary of making general assumptions and needless generalisations. The question before us is as to the legal personality of a trade union and not if a trade union is a company. As such, arguments like the inapplicability of CAMA to trade unions should be totally disregarded and the crux of the argument should be upon the comparison of the characteristics of a trade union with those of a legal entity or juristic person. That is, a person recognised by the law and this is not restricted to companies alone. More so, in the Taff Vale Case, it was held that the fact that a trade union is not a registered corporation (or company) does not negatively affect its capacity to sue and be sued; that is, its legal personality.
The liability of trade unions which is vested on the union as against the officers or members of the union is another pointer to its legal personality. However, this is not to say trade unions or their officers under this guise of legal personality which holds the body responsible as against individual members of the body, should engage in illegality, intending to hide under the legal personality of the union, for ex turpi causa, non oritur action (no action could arise from an illegal transaction) and ex dodo malo non oritur action (no court will lend its aid to a man who found his cause of action upon an immoral or illegal act). This is because there are situations where the corporate veil upon a legal entity would be lifted to make officers of that entity personally liable.
To this end, I submit humbly and upon the arguments with which I so readily agree, that trade unions have legal personalities; the legal persona of the trade union being in part based on its recognition since the Taff Vale’s Case. Trade unions should therefore be treated accordingly.