National law university odisha corporate law I national law university odisha
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- Salomon v. Salomon Co Ltd.
| SOURCES OF DATA Both primary and secondary sources of data have been used for the research. Primary sources of data include case laws and Secondary sources include online sources like articles, blogs, books, case laws and other relevant materials. MODE OF CITATION Mode of citation is in Oxford Standard for Citation of Legal Authorities (OSCOLA) format. NATIONAL LAW UNIVERSITY ODISHA CORPORATE LAW Ii bINTRODUCTION The cornerstone of modern company law is the doctrine of separate legal personality. It is an established principle of law that an incorporated company is separate entity and is distinct from its shareholders and directors. However it is not fully free from their existence. The landmark case of Salomon v. Salomon & Co Ltd. 1 is recognised universally all around the world and is an authority for this principle of corporate separateness. This landmark judgement brought the idea that a company operates behind a metaphoric veil of incorporation that separates the members of the company from the company itself and allows the latter to be entirely independent, with its duties and the rights separate and distinct from that which its shareholders, employees and directors possess. A company is therefore considered as an artificial legal person that exists independently. 2 In this case, Lord Macnaghten states that “The company is at law a different person altogether from the subscribers.” Lord Halsbury LC states that “A company must be treated like any other independent person with its rights and liabilities legally appropriate to itself whatever may have been the ideas or schemes of those who brought it into existence.” It is also an established rule of law that a subsidiary is considered as a separate legal entity and is different and distinct from its holding/parent company But the most celebrated doctrine of piercing the corporate veil is an exception to the rule of the company being a separate legal entity from that of its shareholders and directors. In the case of Download 0.88 Mb. Share with your friends:
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