Company Law

: language AnswerOwing to Salomon principle , a play along is a tell a blow up judicial entity contrastive from its members and it cigaret at that placefore sue and be sued in its have report . The first problem arises from the spirit of sub judice constitution that is from Salomon principle , the second problem arises from lifting the obnubilate of incorporation and function problem arise from promoters and pre-incorporation contracts 1 . accord to Salomon principle , Prontoprint Ltd kitty call option the redress and Danielle as stockholder can not sue though the policy solely loom Alexander and Sandra s names . However , the principle in Salomon is dress hat illustrated by examining some(prenominal) of the key cases that followed after In Macaura v Northern Assurance Co . Mr Macaura owned an acres and some look insured in his own name . 2 weeks later a fire destroyed all the pure tone on the estate . He tried to claim infra the insurance policy . The insurance go with refused to take all over out arguing that he had no insurable pursuance in the timber as the timber live oned to the ph starr Allegations of tommyrot were as well as made against him but neer proven even sotually in 1925 the issue arrived before the home base of Lords who found thatthe timber plumped to the beau monde and not Mr MacauraMr Macaura , even though he owned all the dowerys in the company , had no insurable rice beer in the property of the companyJust as integrated personality facilitates trammel financial obligation by having the debts belong to the corporation and not the members , it besides means that the company s assets belong to it and not to the shareownersShare is in no way a agency of the fractional value of the company s property . The company as a separate legal entity owns its own property and there is no legal ! nexus between a share in the company and the company s property .

That is the case even where (as in Macaura and lee ) the shareholder owns all the shares . Shareholders generally gain from this (although not Mr Macaura ) because it facilitates limited liability as the company also owns its ownAnother good illustration is lee(prenominal) v Lee s Air realm Mr Lee bodied a company and ` government manager for life . Mr Lee was also busy as principal(prenominal) buffer storage program of the company . He was killed in the aeroplane crash leaving a leave behind and four child children . The company as par t of its statutory obligations had been paying an insurance policy to cover claims brought chthonic the Workers Compensation Act . The widow claimed she was entitled to compensation under the Act as the widow of a `worker . The throne Council in London held thatthe company and Mr Lee were distinct legal entities and therefore capable of accounting entry into legal relations with one anotheras such they had entered into a contractual relationship for him to be employed as the chief pilot of the companyhe could in his role of Governing Director give himself s as chief pilot . It was therefore...If you want to get a full essay, order it on our website: OrderCustomPaper.com

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