Independent legal entity cannot be used to circumvent his contractual obligations owed to the other party to the contact. This extension can be both in space, from a king to a kingdom, and in time, from a parent to his descendants. The company had an insurance cover against liability to pay compensation in the event of an accident. Companies registered under companies Act etc. Human beings are capable of so may activities like getting married, having children, becoming sick, dying, going to jail etc.
Their identity, self-worth and status are linked to their corporate conquests. Incorporation, thus, secures not only the element of unity but that of permanence as well. They lack the networking prowess of Survivors and Naturals and rarely inspire the strong loyalty and followership of Alphas. If he set up a company to compete with the previous company within the period of time, technically is the company competing but not the person. Finally expressing these views about the two important theories of legal personality, it can be observed that the existence of corporation is neither wholly fictitious nor wholly real, instead it is partly fictitious and partly real.
In the case of Hotel jaya Puri Bhd v. Top Alphas can even create reality distortion fields where their truth becomes the truth. For the debate about the legal concept, see. In this movement still in its early stages, yet another theory of the corporation is beginning to emerge. Concession Theory — This theory is concerned with the Sovereignty of a State.
Thus, subject to the exceptions allowed for lifting the veil of incorporation, where it is established that a person director or any authorised officer of a company acted on behalf of the company, he does not incur personal liability. So Adam and his family members decided to get the services of the Consultant to get complete knowledge about the company law and for analyzing the above critical situation to solve the above problem, So they hired you as a company law Consultant and asked you to assist them and provide complete knowledge about the company law to finally able to solve the above critical situation. There are some cases applying the principal of independent legal entity in group enterprise such as Goh Hooi Yin v. This is not ironclad or impenetrable. But rights can only be had by real persons; so a corporation must be real and not an imaginary person. Nor as the subscribers as members in any shape or form, except to the extent and in the manner provided by the Act.
Every person is presumed to know the law of land. The courts have not, however, consistently followed any particular theory in dealing with various problems relating to corporation and have, by and large, being guided by practical considerations. However, a typical joint stock company had hundreds or even thousands of members thus stretching the idea of a personal working relationship to near impossibility. If and when the brackets are removed, one would be able to see what the corporation is, what its true nature is, and how its members are revealed through the removal of brackets. They hold that the collective will is, in psychology, different from the individual.
The great defect, however, in the reasoning of the upholders of this theory of corporate personality is that rights, duties and liabilities are thought to be possessed by natural persons alone and not by corporations which are legal entities. On my latest subscribe , guest confirmed my findings. The principal of law can be related to an English case of Macaura v. A remarkable amount of scholarly examination of these theories has continued for more than a century. From that moment it could own property and accept transfer of assets and liabilities in its corporate name. After that, the greater part of the estate caught fire but the respondent refuse to pay the appellant by argued that he had no insurable interest towards the estate.
Section 60 states that all dividends can only be paid as part of profits. As shareholder, L had no insurable interest in the forest because the company was a separate entity. But who will lead that change? Being the mere creature of law, it possesses only those properties which the charter of its creation confers upon it, either expressly or as incidental to its very existence. Kelsen shows that there is no significant difference between the legal personality of an individual and that of corporation, for in the case of both what is known as legal personality is nothing but a complex of norms, that is to say, what is constituted by the bundle of rights and duties and liabilities centering round, and the norms which rule the behavior of individuals are also the norms that determine the rights and duties of corporations. Even the public opinion demands and is in real need of such recognition which the legislature satisfies. Under this view, the corporation is a juridical unit with its own claims, much like those of a natural person, that extend beyond both the circumstances of its legal creation by the state and the claims or interests of its shareholders. The debentures were perfectly valid and Salomon was entitled to the remaining assets in part payment of the secured debenture held by him.
Whether he does so is to be determined by the nature and terms of the contract and the surrounding circumstances. M had previously insured the forest in his own name but omitted to change the relevant policy to state the name of the company as owner. His generosity has led him to fall far behind the payments of the debts. The company cannot insist on further contribution nor can the members be liable to cover debts which the company incurred as a separate person. According to Ihering, the conception of corporate personality is essential and is merely an economic device by which we can simplify the task of coordinating legal relations. In this case a school was run like a company but the shares were held by trustees on educational charitable trusts.
The House of Lords held that only the company as the separate legal owner of the property, and not the plaintiff, had the required insurable interest. Heretics have four general paths: 1 Get beaten down by the system 2 Succeed at bringing change and fixing a broken system 3 Leave and become Richard Branson 4 Escape it all to work in a call center in Peoria. Gierke believed that the existence of a corporation is real and not based on any fiction. Hazril Izwar Ibrahim Name : Kok Cheng Hon Matric No. These theories are not a mere existence in intellectual acrobatism but lead to important legal and practical consequences. The organism theory of the personality of the corporation is the one that expounds that the corporation, like an organism, has members limbs , head and other organs. The appellant sold the whole timber estate to a company called Irish Canadian Sawmills Ltd.