National law university odisha corporate law I national law university odisha
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- Ord v. Belhaven Pubs Ltd .21Ord v. Belhaven Pubs Ltd.
- Salomon vb iibSalomon Co Ltd.
| Polly Peck Internationalplc 20 in which Robert Walker J concluded that he could not accede to that submission for it would create anew exception to the Salomon principle unrecognised by the Court of appeal in Adams v Cape Industries, something which was not open to the court A further rejection of the concept that a group of companies can be termed as a single economic unit can be witnessed in the case of Ord v. Belhaven Pubs Ltd. 21 Ord v. Belhaven Pubs Ltd. 19 Holdsworth & Co v Caddies [1955] l WLR 352 HL. 20 Re Polly Peck International plc [1996] 1 BCLC 428. 21 Ord v Belhaven Pubs Ltd [1998] 2 BCLC 447 CA. NATIONAL LAW UNIVERSITY ODISHA CORPORATE LAW Ii This case concerned an attempt made by the plaintiff in order to substitute the original defendant subsidiary company with either of the two another wholly-owned subsidiary or its parent company in the group as, following a restructuring of the group, the original defendant no longer had substantial assets. The Court of Appeal noted that the trial judge, who had permitted the substitution of the defendant, appeared to have viewed the whole group as an economic entity and therefore thought substitution, was appropriate This approach was emphatically rejected by Hobhouse LJ who stated that “The approach of the judge in the present case was simply to look at the economic unit, to disregard the distinction between the legal entities which were involved and to say since the company cannot pay, the shareholders who are the people financially interested should be made to pay instead. That of course is radically at odds with the whole concept of corporate personality and limited liability and the decision of the House of Lords in Salomon v Salomon Co. Ltd.” Hobhouse LJ further said that “the true position is that companies are entitled to organise their affairs in group structures and to expect the courts to apply the principles of Salomon vb iibSalomon Co Ltd. in the ordinary way.” NATIONAL LAW UNIVERSITY ODISHA CORPORATE LAW Ii bEVOLUTION OF THE DOCTRINE OF SINGLE ECONOMIC ENTITY DOCTRINE Download 0.88 Mb. Share with your friends:
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