the concept of legal personality

Question 1

1. definition of the veil of a corporation

2.locus classicus case (1/1)

Answer 1

1. jurisdictional person distinct from the shareholders and directors
2. salomon v salamons
   affirmed in lee v lee(legal conseq of s v s that widow had to be compensated.

Question 2

adv of incorporation (6)

Answer 2

1. perpetual succession
2. limited liability on the owners
3. transefrability of shares
4. capacity of suing and being sued
5. borrowing facilities
6. holding and owning property

Question 3

exception: piercing the veil of incorporation (5) *
5 cases

Answer 3

1. fraudelent trading (very wide definition) - githunguri dairy farmers v ernie campbell (s.787 companies act
2. holding and subsidiary company: smith stone v birmingham (injustice will be cause dif veil is not pierced e.f escape liability)
   has exception to not lift corporate veil (question of fact)
3. exploitation of minority of shareholders: Re bugle press limited
4. taking adv of legal rovion- gilford v horne (created company for solicitiation when he had agreed with his former employer he would not solivitate the plaintiff customers.
5. determining the residence of a company: a company is a jurisidical person but it doesnt mean it can sleep or eat but can house business.
   therefore, the veil is lifted to look place of registration and determine its residence (de beers consolidated mine) - the central management and control

Question 3

incorporation

role of promoter - i case

duties - 5

liabilities - 4

Answer 3

Twyford v grant

ds- i case
dmf
fd
disclose private arrangement
against future allotee

1. AC for p
2. PL
3. misstatement in prospectus
4. winding up liability

Question 4

pre-incorporation contracts 1 case

Answer 4

price v kelsall
not binding
neither is ratification enough but inferred.