53/55 St. George's Road. Lords Wilberforce, Fraser and Russell and Dundy concurred. Lords Wilberforce, Fraser and Russell and Dundy concurred. Petrodel Resources Ltd (PRL), which was incorporated in the Isle of Man, was the legal owner of the matrimonial home and five other residential properties in the United Kingdom. The whole of the shop premises was occupied by a company called M. & L. Campbell (Glasgow) Limited (Campbell) and used by it for the purpose of its business as costumiers specialising in wedding garments. Academia.edu no longer supports Internet Explorer. Woolfson v Strathclyde Regional Council [viii] that the House of Lords considered that there is one circumstance in which the corporate veil can pierce, namely when there is one circumstance in which the corporate veil can be pierced, namely when there are special circumstances indicating a faade concealing the true facts. They had twenty and ten shares respectively in Solfred Ltd. Mr Woolfson and Solfred Ltd claimed compensation together for loss of business after the compulsory purchase, arguing that this situation was analogous to the case of DHN v Tower Hamlets LBC.[1]. Lord Keith observed that it is appropriate to pierce the corporate veil only where special circumstances exist indicating that it is a mere facade concealing the true facts. Where the evidence shows that a company has been used as a vehicle or device for receiving monies wrongly paid out of a claimant company in breach of a defendants duty to that company, the receipt by the third party vehicle will be treated as the receipt by the defendant. 33 (3), sect. 59/61 St Georges Road were credited to Woolfson in Campbells Road. and dogs Im a perfectionist too, Lord Keith, Lord Wilberforce, Lord Fraser and Lord Russell, DHN Food Distributors Ltd v Tower Hamlets LBC, Ord v Belhaven Pubs Ltd, Jones v Lipman, Woolfson v Strathclyde Regional Council Wikipedia, DHN Food Distributors Ltd v Tower Hamlets LBC, Case Law Company single economic entity Woolfson v Strathclyde Regional Council 1978. From 1952 until 1963, when Schedule A taxation was abolished, payments by way of rent for Nos. 41-4, December 2014, Melbourne University Law Review Vol. Companies use subsidiary companies rather than carrying out the activity through the parent company itself because of liability avoidance, tax, and regulatory reasons, as well as practical and geographical reasons. Woolfson v Strathclyde Regional Council [1978] UKHL 5 is a UK company law case concerning piercing the corporate veil. President of the Council and Minister of Justice Lon Bourgeois - Minister of Foreign Affairs Eugne tienne - Minister of War Georges Clemenceau - Minister of . But the shop itself, though all on one floor, was composed of different units of property. Furthermore, Woolfson v. Strathclyde Regional Council [12] insisted on the application of the rule in special circumstances alone and where the motive is well established. An alternative to lists of cases, the Precedent Map makes it easier to establish which ones may be of most relevance to your research and prioritise further reading. Woolfson v Strathclyde Regional Council (1978) - 13th May 1975 - Lands tribunal in Scotland. 6 ibid [63], [103]. Counsel: James R. Kitsul, for the appellant; Sarah Macdonald, for the respondent. Chapter 7: Corporations and legal personality Woolfson was the sole director of 'A' and owned 999 shares of the 1,000 issued . (H.L.) Applied - Woolfson v Strathclyde Regional Council HL 15-Feb-1978 The House considered the compensation payable on the compulsory purchase of land occupied by the appellant, but held under a company name. There are certain cases which involve attempts to use the corporate form to avoid existing legal obligations to which the defendants were subject. This is an appeal against an interlocutor of the Second Division of the Court of Session affirming the decision of the Lands Tribunal for Scotland upon a question relating to compensation for the compulsory acquisition of land. court. (H.L.) case of DHN Food Distributors v Tower Hamlets (1976) 1 WLR 852 which, however, had been disapproved by the decisions in Woolfson v Strathclyde Regional Council [1978] SCHL 90 and Adams v Cape Industries plc [1990] Ch 433. Introduction Woolfson v Strathclyde Regional Council Common law countries usually uphold this principle of separate personhood, but in exceptional situations may pierce or lift the corporate veil. The third company, also a wholly owned subsidiary of D.H.N., owned as its only asset the vehicles used in the grocery business, and it too carried on no operations. This followed the refusal by the court to allow Campbell and Mrs Woolfson to be joined as additional claimants in the proceedings. 27 and Meyer v Scottish Co-operative Wholesale Society Ltd 1958 S.C. From 1952 until 1963, when Schedule A taxation was abolished, payments by way of rent for Nos. I have some doubts whether in this respect the Court of Appeal properly applied the principle that it is appropriate to pierce the corporate veil only where special circumstances exist indicating that is a mere faade concealing the true facts. Woolfson v Strathclyde Regional Council [1978] UKHL 5 is a UK company law case concerning piercing the corporate veil. Woolfson v. Strathclyde Regional Council 1978 S.L.T. 59/61 St. George's Road were credited to Woolfson in Campbell's books. Facts; Judgment; See also; Notes; References; External links; Facts. A critical analysis on Prest v Petrodel Resources Ltd and Others, Lord Wilberforce,Lord Fraser of Tullybelton,Lord Russell of Killowen,Lord Keith of Kinkel, Journal of Corporate Commercial Law & Practice Nbr. Following Adams v Cape Industries Plc, further extracts from which are set out, it is below, it is clear that the faade concealing the true facts test has become the primary reference point for any lawyer investigating whether it is possible to pierce the corporate veil and even the same judgment was held in the case of Ord & Another v Belhaven Pubs Ltd[ix]. Three of the premises were owned by Woolfson and the other two by another limited company 'B'. . A bridal clothing shop at 53-61 St George's Road was compulsorily purchased by the Glasgow Corporation. 40 Nbr. There are certain cases which involve attempts to use the corporate form to avoid existing legal obligations to which the defendants were subject. 59/61 St. George's Road were credited to Woolfson in Campbell's books. The argument is in my opinion unsound, and must be rejected. Court case. 95 (Eng.) Food Distributors case (supra) is, on a proper analysis, of assistance to the appellants' argument. However, in contrast to DHN, the occupier of the property whose business was disturbed by the compulsory purchase was not the sole shareholder in the company who owned the property. 53/55 St. George's Road. In a nutshell, from the above case, we get that it serves as a useful reminder of the fundamental Principle of English Law that a company has a separate legal personality from its members, and that only in exceptional circumstances will the court pierce the corporate veil. In the above-mentioned case, the Court of appeal thought that the present case was one which was suitable for lifting the corporate veil. Held: The House declined to allow the principal shareholder of a company to recover compensation for the . Piercing the corporate veil or lifting the corporate veil is a legal decision to treat the rights or duties of a corporation as the rights or liabilities of its shareholders. Facts. a sufficient interest in the land to found a claim to compensation for disturbance and (3) (per Goff and Shaw LL.J.) Draft leases were at one time prepared, but they were never put into operation. 935 C.A. 8]. In Woolfson v. Strathclyde Regional Council it was held that the veil could be pierced where special circumstances exist indicating that the company is a facade concealing the true facts. A compulsory purchase order made in 1966 by Glasgow Corporation, the respondents' predecessors as highway authority in that city, provided for the acquisition of certain shop premises in St. George's Road, the date of entry being 29th January 1968. (H.L.) This website uses cookies to improve your experience while you navigate through the website. Here the three subsidiary companies were treated as a part of the same economic entity or group and were entitled to compensation. The issued share capital of Campbell was 1,000 shares, of which 999 were held by Woolfson and one by his wife. The Land Tribunal denied it on the basis that Campbell Ltd was the sole occupier. Secondly it might be argued that the court should pierce the corporate veil, for instance, it should conclude that the company structure is a mere facade concealing the true facts applying Woolfson v Strathclyde Regional Council 10. Company Law Cases List of the Major Cases in Company Law; Reading 2 - Test FCE The oldest leather shoe in the world; Lab report - standard enthalpy of combustion; Multiple Choice Questions Chapter 16 Public Goods; Stage 1 Visit 1 efnwklf; Dd102 TMA-1 - Grade: 93%; Multiple Choice Questions Chapter 15 Externalities; 03.+Lulu+The+Lioness 3 Indeed, in support of this part of his argument Mr Ashe referred to the case of Woolfson v. Strathclyde Regional Council [1978] SLT 159, and DHN Ltd v Woolfson v Strathclyde Regional Council - WikiVisually Secondly it might be argued that the court should pierce the corporate veil, for instance, it should conclude that the company structure is . Woolfson v Strathclyde Regional Council (1979) 38 P & CR 521 Wrexham Maelor Borough Council v MacDougall [1993] 2 EGLR 23 Wrotham Park Settled Estates v Hertsmere Borough Council [1993] 2 EGLR 15 Page No(s) 106, 205 69, 172 195, 201 44 116, 208 42 83 115 55 119 50 114 214 126 20 81, 209 21, 68, 73, 75, 82, 84, 97, 185, 187, 201, 212 66 163 8 . To view the purposes they believe they have legitimate interest for, or to object to this data processing use the vendor list link below. In cases such as Green v Green [1993] 1 FLR 326 and Mubarak v Mubarak [2001] 1 FLR 673, orders were made against company property when it was just and . Subnautica Vr Controls, Corporate structures, the veil and the role of the courts. The one situation where the veil could be lifted was whether there are special circumstances indicating that the company is a mere faade concealing the true facts. Copyright 2020 Lawctopus. 2. IMPORTANT:This site reports and summarizes cases. Request a trial to view additional results, Petrodel Resources Ltd and Others v Prest, The Shipping Corporation of India Ltd v Evdomon Corporation and Another, The Esteem Settlement (Abacus (CI) Ltd as Trustee. After the case . Note that since this case was based in Scotland, different law applied. Subscribers are able to see any amendments made to the case. Adams and others v. Cape Industries Plc. The Land Tribunal denied it on the basis that Campbell Ltd was the sole occupier. Koalas are marsupials that are native to the Australian continent. The consent submitted will only be used for data processing originating from this website. In Gilford Motor Co. Ltd. V. Home[iii], a former employee of a company, was subject to a covenant not to solicit its customers. A bridal clothing shop at 53-61 St George's Road was compulsorily purchased by the Glasgow Corporation. The House of Lords made it very clear in Salomon v Salomon, that the company is not the shareholders agent by reason of the fact of incorporation. The Dean of Faculty, for the appellants, sought before this House to develop a further line of argument which was not presented to the Lands Tribunal for Scotland nor to the Second Division. From 1962 till 1968 Campbell paid rent to Solfred in respect of Nos. 57 St. George's Road. The whole of the shop premises was occupied by a company called M. & L. Campbell (Glasgow) Limited ("Campbell") and used by it for the purpose of its business as costumiers specialising in wedding garments. Treated as a part of the courts 's Road were credited to Woolfson in Campbell 's books, by. 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