Introduction
Salomon v A Salomon established a century-old principle of the separate juristic personality of a corporation (the corporate veil). It provides a method of limitation of liability, protects shareholders’ private assets and facilitates business development. Cases have shown, however, that the corporate veil may be mis-used by the controllers of the corporate structure to perpetrate wrongdoing.
• Fraud apart, how far does the law go to protect parties, who deal with the corporation, when they suffer loss by reason of wrongdoing of its controllers?
• What type of wrongdoing would suffice to pierce the corporate veil?
• Would the requirement of justice be an imperative?
• If it is appropriate to pierce the veil, would the controllers become parties to a particular contract between the corporate and the person who pursues enforcement of that contract?
Such questions were dealt with by the English courts, including the Supreme Court, in recent cases (Petrodel v Prest and VTB Capital v Nutritek).
This seminar explores the above questions and deals with the following aspects:
1. Basic principles – the doctrine of piercing the corporate veil – an overview
2. The scope and limits of the doctrine under English law – Petrodel v Prest
3. What happened to A. Gramsci cases? – VTB Capital v Nutritek
4. The extent and scope of the doctrine under the law of some other jurisdictions