Company Law
Explain what the following statement means, to critically discuss this statement and indicate whether or not you agree with this statement, and you
should provide reasons why you hold such position.
Project description
Subject: Company Law
Essay Requirement:
A UK limited company is considered to be an artificial legal person. Over many decades various decisions of judges in addition to the Company Acts
2006 have provided an understanding of what it means for a company to be an artificial legal person.
This midterm assignment requires you to write and submit an essay of no more than 1500 words (excluding references and essay title) on an issue that
is part of this topic. Reference will include references to decide cases and also to Acts of Parliament and sections in those Acts of Parliament.
The subject matter of the essay is as follow:
These consideration reflect the broader principle that the corporate veil may be pierced ONLY to prevent the abuse of corporate legal personality. It
may be an abuse of the separate legal personality of a company to use it to evade the law or to frustrate its enforcement. It is not an abuse to
cause a legal liability to be incurred by the company in the first place. It is not an abuse to rely upon the fact (if it is a fact) that a liability
is not the controller’s because it is the company’s. On the contrary, that is what incorporation is all about.
Presr (Appellant) v Petrodel Resources Limited and others (Respondents) [2013] UKSC 34 (Lord Sumption Paragraph 34)
You are required in your essay to explain what this statement means, to critically discuss this statement and indicate whether or not you agree with
this agreement. When you indicate whether or not you agree with this statement you should provide reasons why you hold such a position.
NO LONGER THAN 1500 WORDS (excluding reference and essay title)
The above is the requirement from our subject coursework assignment handbook.
As our lecturer said, we can’t agree or disagree the whole statement and we don’t need to describe those cases that we find as a reference, just put
the cases’ name and their judgement (I think so)
And the following questions are my lecturer talked about in our lecture i think it is very important:
“These consideration reflect the broader principle that the corporate veil may be pierced ONLY to prevent the abuse of corporate legal personality”
1.Do you agree that this is the ONLY circumstance in which the “corporate veil maybe pierced” ?
2.what are the “considerations” to which he refers ?
3.what does Lord Sumption mean by “corporate veil” ?
4.What does Lord Sumption mean by this statement. ?
“It may be an abuse of the separate legal personality of a company to use it to evade the law or to frustrate its enforcement. ”
1.Lord Sumption uses the word “MAY” this suggests that there might be other circumstace in which an abuse of the separate legal personality of a
company occurs.
2.Lord Sumption provides two possibilities: 1)evade the law or 2frustrate its enforcement. What does he mean? Hpw are possibilities to be
distinguished?
3.Are there any circumstance other than the two referred to by Lord Sumption that could constitute an abuse of the separate legal personality of a
company?
“It is not an abuse to cause a legal liability to be incurred by the company in the first place. It is not an abuse to rely upon the fact (if it is a
fact) that a liability is not the controller’s because it is the company’s. On the contrary, that is what incorporation is all about.”
1.Lord Sumption is explaining what is not an abuse. What does he mean?
2.Are there other circumstance that Lord Sumption would acknowledge as not constituting an abuse?
I think these above informations will help a lot.
