inTunstall v. Steigmann[1962] 2 Q.B. [iv] Jones v. Lipman and Another (1962) 1 WLR 832 L. [v] D.H.N.food products Ltd. V. Tower Hamlets, LBC [1976] 1 WLR 852, [vi] Woolfson v Strathclyde Regional Council, [1978] SC (HL) 90, [vii] Adam v Cape Industries Plc, [1990] Ch 433, [viii] Woolfson v Strathclyde Regional Council, [1978] SC (HL) 90, [ix] Ord & Another v Belhaven Pubs Ltd, [1998] 2 BCLC 447, [x] Prest v Petrodel Resources Ltd and Others, [2013] UKSC 34, [xi]Gramophone and typewriter, Ltd v Stanley, [1908] 2 KB 89, Give it a try, you can unsubscribe anytime :), Get to know us better! 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. Having examined the facts of the instant case, the Lord Justice-Clerk reached the conclusion that they did not substantiate but negatived the argument advanced in support of the unity proposition and that the decision in theD.H.N. 21Ben Hashem v Shayif [2008] EWHC 2380 (Fam) [159] - [164]. Cookie policy. 2 Salomon v A Salomon and Co Ltd [1897] AC 22. 6 ibid [63], [103]. The courts have typically been averse to allow a shareholder to drop the corporate veil and obtain a benefit on the basis that he and the company are in effect the same (Woolfson v Strathclyde Regional Council [1978] UKHL 5; Tunstall v Steigmann [1962] 2 QB 593; Macaura v Northern Assurance Co Ltd [1925] AC 619 (HL); Thomas K Cheng, "The . V, January 2019. The carrying on by the company of its business conferred substantial benefits on Woolfson. It was disregarded as being a heresy that had to be erased. I agree with it, and for the reasons he gives would dismiss the appeal. Cape Industries plc., and on an observation by Lord Keith in the House of Lords decision in Woolfson v. Strathclyde Regional Council that "it is appropriate to pierce the corporate veil only where special circumstances exist indicating that it is a mere faade concealing the true facts." 95 (Eng.) Subscribers are able to see a visualisation of a case and its relationships to other cases. United Kingdom. In such a case, the Court may examine the character of persons in real control of the company, and declare the company to be an enemy company. 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] UKHL 5 is a UK company law case concerning piercing the corporate veil. The US subsidiary had no assets. subsequent case following adams (O) williams v natural health foods ltd. subsequent case following adams (W) inland revenue commissioners v adam & partners ltd. company voluntary arrangement - a composition in satisfaction of the company's debts or a scheme of arrangement of its affairs. In times of war it is illegal to trade with the enemy. Subscribers are able to see a list of all the cited cases and legislation of a document. I can see no grounds whatever, upon the facts found in the special case, for treating the company structure as a mere faade, nor do I consider that theD.H.N. 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. Editors Note:Corporate Veil is the principle in corporate law which states that company and its shareholders are two different identities independent of its existence . The grounds for the decision were (1) that since D.H.N. 57 St. George's Road. From the paper "Limits of Employment-At-Will Doctrine" it is clear that the employment at will doctrine has its own limits. Woolfson also owned 20 of the 30 issued shares of company 'B', with the other 10 being owned by his wife. PDF Lifting, Piercing and Sidestepping the Corporate Veil Ord v Belhaven Pubs Ltd [1998 . Company Constitution What is the purpose of the memorandum of association . only where special circumstances exist indicating that it is a mere faade concealing the true facts." Of Landmark or Leading Cases: Salomon's Challenge. court. 433, Yukong Line Ltd v Rendsburg Investments Corporation of Liberia [1998] 1 WLR 294, Ord v Belhaven Pubs Ltd [1998] BCC . Jones v. Lipman and Another[iv], L Agreed to sell certain land to J. 935 C.A. Woolfson V Strathclyde Regional Council: Editors: Jesse Russell, Ronald Cohn: Publisher: Book on Demand, 2012: ISBN: 5512263587, 9785512263587: I agree with it and with his conclusion that this appeal be dismissed. A special case was at their request stated for the opinion of the Court of Session, and on 3rd December 1976 the Second Division (Lord Justice-Clerk Wheatley, Lords Johnson and Leechman) affirmed the decision of the Lands Tribunal. After the case . (Piercing the veil for attempting to evade a legal obligation); In re Darby, Brougham, [1911] 1 KB. imported from Wikimedia project. Woolfson v Strathclyde Regional Council [1978] UKHL 5 is a UK company law case concerning piercing the corporate veil. Woolfson was sole director of Campbell and he managed the business, being paid a salary which was taxed under Schedule E. His wife also worked for Campbell and provided valuable expertise. Woolfson v Strathclyde Regional Council [1978] UKHL 5. (158) Ibid 564. J.) J.) Subscribers are able to see the revised versions of legislation with amendments. C Minor Autotune, See more Redirects here: Caddies v Harold Holdsworth & Co (Wake-field) Ltd, Harold Holdsworth Ltd v Caddies. ,Sitemap. In the recent case Prest v Petrodel Resources Ltd[x], it was held that evasion is piercing. 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. the "well-recognised exception" to the rule prohibiting the piercing of the corporate veil derives from a line of cases preceding prest v petrodel which determined that only in certain limited and well defined circumstances will a court be permitted to pierce the corporate veil, including where the existence of the corporate veil is abused by [1978] UKHL 5, [1979] JPL 169, (1978) 248 EG 777, 1978 SC (HL) 90, 1978 SLT 159, (1979) 38 P and CR 521if(typeof ez_ad_units != 'undefined'){ez_ad_units.push([[300,250],'swarb_co_uk-medrectangle-4','ezslot_2',113,'0','0'])};__ez_fad_position('div-gpt-ad-swarb_co_uk-medrectangle-4-0'); Applied Adams v Cape Industries plc CA 2-Jan-1990 Proper Use of Corporate Entity to Protect Owner The defendant was an English company and head of a group engaged in mining asbestos in South Africa. Woolfson v Strathclyde Regional Council [1978] UKHL 5 is a UK company law case concerning piercing the corporate veil. Lord Keith upheld the decision of the Scottish Court of Appeal, refusing to follow and doubting DHN v Tower Hamlets BC. 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. Mr Woolfson had 999 shares in Campbell Ltd and his wife the other. 0 references. edit. (H.L.) A bridal clothing shop at 53-61 St George's Road was compulsorily purchased by the Glasgow Corporation. The business in the shop was run by a company called Campbell Ltd. Salomon v Salomon (1897) A.C. 22 (H.L.) Food case to be clearly distinguishable on its facts from the present case. Woolfson holds two-thirds only of the shares in Solfred and Solfred has no interest in Campbell. Here, on the other hand, the company that carried on the business, Campbell, has no sort of control whatever over the owners of the land, Solfred and Woolfson. 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]. swarb.co.uk is published by David Swarbrick of 10 Halifax Road, Brighouse, West Yorkshire, HD6 2AG. Held: The House declined to allow the principal shareholder of a company to recover compensation for the compulsory purchase of a property which the company occupied. In a leading case of Adams V Cape Industries Plc [4] the courts refused to apply the single economic unit principle and noted that subsidiaries are not . At the same time, pursuing a group interest might assist in resolving the financial difficulties. Tel: 0795 457 9992, or email david@swarb.co.uk, Darg v Commissioner Of Police for the Metropolis: QBD 31 Mar 2009, Prest v Petrodel Resources Ltd and Others, AA000772008 (Unreported): AIT 30 Jan 2009, AA071512008 (Unreported): AIT 23 Jan 2009, OA143672008 (Unreported): AIT 16 Apr 2009, IA160222008 (Unreported): AIT 19 Mar 2009, OA238162008 (Unreported): AIT 24 Feb 2009, OA146182008 (Unreported): AIT 21 Jan 2009, IA043412009 (Unreported): AIT 18 May 2009, IA062742008 (Unreported): AIT 25 Feb 2009, OA578572008 (Unreported): AIT 16 Jan 2009, IA114032008 (Unreported): AIT 19 May 2009, IA156022008 (Unreported): AIT 11 Dec 2008, IA087402008 (Unreported): AIT 12 Dec 2008, AA049472007 (Unreported): AIT 23 Apr 2009, IA107672007 (Unreported): AIT 25 Apr 2008, IA128362008 (Unreported): AIT 25 Nov 2008, IA047352008 (Unreported): AIT 19 Nov 2008, OA107472008 (Unreported): AIT 24 Nov 2008, VA419232007 (Unreported): AIT 13 Jun 2008, VA374952007 and VA375032007 and VA375012007 (Unreported): AIT 12 Mar 2008, IA184362007 (Unreported): AIT 19 Aug 2008, IA082582007 (Unreported): AIT 19 Mar 2008, IA079732008 (Unreported): AIT 12 Nov 2008, IA135202008 (Unreported): AIT 21 Oct 2008, AA044312008 (Unreported): AIT 29 Dec 2008, AA001492008 (Unreported): AIT 16 Oct 2008, AA026562008 (Unreported): AIT 19 Nov 2008, AA041232007 (Unreported): AIT 15 Dec 2008, IA023842006 (Unreported): AIT 12 Jun 2007, HX416262002 (Unreported): AIT 22 Jan 2008, IA086002006 (Unreported): AIT 28 Nov 2007, VA46401-2006 (Unreported): AIT 8 Oct 2007, AS037782004 (Unreported): AIT 14 Aug 2007, HX108922003 and Prom (Unreported): AIT 17 May 2007, IA048672006 (Unreported): AIT 14 May 2007. From 1962 till 1968 Campbell paid rent to Solfred in respect of Nos. and another 1984 - CA. Lord Keith's judgment dealt with DHN as follows. Nos. But however that may be, I consider the D.H.N. Sorry, preview is currently unavailable. country. Woolfson v Strathclide UKHL 5 . It was argued, with reliance onD.H.N. and Bronze under which the former had an irrevocable licence to occupy the premises for as long as it wished, and that this gave D.H.N. Scribd is the world's largest social reading and publishing site. a sufficient interest in the land to found a claim to compensation for disturbance and (3) (per Goff and Shaw LL.J.) Dr Wallersteiner had bought a company . The Land Tribunal denied it on the basis that Campbell Ltd was the sole occupier. He said that DHN was easily distinguishable because Mr Woolfson did not own all the shares in Solfred, as Bronze was wholly owned by DHN, and Campbell had no control at all over the owners of the land. 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]. There can be no doubt, and it is not now disputed by the appellants, that Campbell was throughout the occupier of the shop premises and that the business carried on there was that of Campbell. 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 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. 116. I agree with it and with his conclusion that this appeal be dismissed. It is the first of those grounds which alone is relevant for present purposes. Note that since this case was based in Scotland, different law applied. Woolfson holds two-thirds only of the shares in Solfred and Solfred has no interest in Campbell. . Facts; Judgment; See also; Notes; References; External links; Facts. Woolfson was the sole director of 'A' and owned 999 shares of the 1,000 issued shares of company 'A', the remaining share being owned by his wife. Statements. In Woolfson v Strathclyde Regional Council, the House of Lords disapproved of Denning's comments and said that the corporate veil would be upheld unless the company was a faade. For the reasons stated in it, I also would dismiss this appeal. From 1952 until 1963, when Schedule A taxation was abolished, payments by way of rent for Nos. (H.L.) and another, [1984]) . 542. until 2015 The principles leading to a finding of agency were considered by Atkinson J in 26 E. g. Woolfson v. Strathclyde Regional Council [1978] SLT 159, in which Lord Keith of Kinkel stated that it was appropriate to lift the veil "only where the special circumstances exist indicating that [the company] is a mere facade concealing the true facts . The activities of subsidiary companies are an integral part of the activities of the group of companies to which they belong. There are certain cases which involve attempts to use the corporate form to avoid existing legal obligations to which the defendants were subject. 53/55 were owned by the second-named appellant Solfred Holdings Ltd. ("Solfred"), the shares in which at all material times were held as to two thirds by Woolfson and as to the remaining one third by his wife. The compulsory acquisition resulted in the extinction of the grocery business, since no suitable alternative premises could be found. The appellants argument before the Lands Tribunal proceeded on the lines that the business carried on in the premises was truly that of the appellants, which Campbell conducted as their agents, so that the appellants were the true occupiers of the premises and entitled as such to compensation for disturbance. In my opinion the conclusion was correct, and I regard as unimpeachable the process of reasoning by which it was reached. Any direct loss consequent on disturbance would fall upon Campbell, not Woolfson. Woolfson v Strathclyde RC [1978] UKHL 5 (15 February 1978) admin March 8, 2020 INTERNATIONAL / U.K. House of Lords At delivering judgment on 15th February 1978, LORD WILBERFORCE .My Lords, I have had the advantage of reading in draft the speech to be delivered by my noble and learned friend Lord Keith of Kinkel. (49) Woolfson v. Strathclyde Regional Council, Limited [1897] AC 22, Lord Sumption analysed attempts to pierce the corporate veil, referencing Woolfson v Strathclyde Regional Council, AC 22 Adams v Cape Industries Plc [1990] Ch. Adams and others v. Cape Industries Plc. . 2. In my opinion there is no basis consonant with principle upon which on the facts of this case the corporate veil can be pierced to the effect of holding Woolfson to be the true owner of Campbells business or of the assets of Solfred. 9 Thompson v Renwick Group Plc [2014] EWCA Civ 635, [2015] BCC 855. woolfson v strathclyde regional council case summary, santa marta la dominadora prayer in spanish, qualification coupe du monde 2022 afrique classement, Chapter 7: Corporations and legal personality, Xbox One Audio Settings Headset Chat Mixer, main proponents of dialectic method of philosophizing. 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. Chapter 7: Corporations and legal personality Woolfson was the sole director of 'A' and owned 999 shares of the 1,000 issued . The leading case is Cape Industries. Cape Industries plc., and on an observation by Lord Keith in the House of Lords decision in Woolfson v. Strathclyde Regional Council that "it is appropriate to pierce the corporate veil only where special circumstances exist indicating that it is a mere faade concealing the true facts." A significant fallout of the decision in Hashem v. Search over 120 million documents from over 100 countries including primary and secondary collections of legislation, case law, regulations, practical law, news, forms and contracts, books, journals, and more. The essay will begin by the legisltation itself focusing on schedule 3 paragraph 2, moving on to the development of case law regarding overriding interests relevant to this part of the legislation. The business in the shop was run by a company called Campbell Ltd. 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. This website uses cookies to improve your experience. 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. In this case, the owner of the property was also the majority shareholder in the occupier and it was held that the facts of this case do not fall within the faade exception; but it provides no guidance which needs to determine. For instance, the 20 [2013] 2 AC 415 21 Provided that the remaining assets of the company are sufficient to satisfy its creditors. I have had the advantage of reading in draft the speech to be delivered by my noble and learned friend Lord Keith of Kinkel. It carried on no activities whatever. You can use it as an example when writing your own essay or use it as a source, but you need VTB Capital plc v Nutritek International Corp [2013] UKSC 5. (160), 20Adam (n.18) [536] and [542]. This argument was rejected by the court for the reasons given in the opinion of the Lord Justice-Clerk. 961; [1996] CLC 990; (1996), 160 J.P. Rep. 1130; 146 New L.J. Woolfson v Strathclyde Regional Council [1978] UKHL 5 is a UK company law case concerning piercing the corporate veil. Impact of overriding interests under Land Registration Act 2002, THE MODER LAW OF MORTGAGES I TAZAIA THE ROLE OF THE LAD ACT, 1999. Indeed, in Woolfson v Strathclyde Regional Council 1978 . Bronze had the same directors as D.H.N. We and our partners use cookies to Store and/or access information on a device. On the contrary, the fundamental principle is that each company in a group of companies is a separate legal entity possessed of separate legal rights and liabilities. His interest in the loss is at best an indirect one, no different in kind from that of his wife, whose interest as a shareholder, though a minor one, cannot be completely ignored, or that of creditors of Campbell. Moreover, the House of Lords indicated that the decision in DHN Food Distributors was incorrect. There are certain cases which involve attempts to use the corporate form to avoid existing legal obligations to which the defendants were subject. The DHN case approach has become less popular since then. reasons for lifting the veil of incorporation circumstances when the veil is lifted are haphazard and difficult to categorize. Mr Solomon Woolfson owned three units and another company, Solfred Holdings Ltd owned the other two. Campbell was throughout shown in the valuation roll as occupier of the shop premises, but its occupation was not regulated by lease or any other kind of formal arrangement. The court was asked as to the power of the court to order the transfer of assets owned entirely in the companys names. 5 minutes know interesting legal mattersWoolfson v Strathclyde Regional Council [1978] 2 EGLR 19 (HL) (UK Caselaw) In Woolfson v Strathclyde Regional Council, the House of Lords disapproved of Denning's comments and said that the corporate veil would be upheld unless the company was a faade. Subscribers are able to see the list of results connected to your document through the topics and citations Vincent found. There the company that owned the land was the wholly owned subsidiary of the company that carried on the business. 53/55 St. George's Road. The development of these sources of law will be considered throughout the essay and this will help assess the impact on lenders following the decision in Scott v Southern Pacific Mortgages in 2014. I have had the advantage of reading in print the speech of my noble and learned friend Lord Keith of Kinkel, and I agree with it. 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. 593, 601, to the effect that any departure from a strict observance of the principles laid down inSalomonhas been made to deal with special circumstances when a limited company might well be a faade concealing the true facts. He said that DHN was easily distinguishable because Mr Woolfson did not own all the shares in Solfred, as Bronze was wholly owned by DHN, and Campbell had no control at all over the owners of the land. A bridal clothing shop at 53-61 St George's Road was compulsorily purchased by the Glasgow Corporation. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. the separate personality of a company is a real thing. legal case. From 1952 until 1963, when Schedule A taxation was abolished, payments by way of rent for Nos. Usually, a corporation is treated as a separate legal person, which is solely responsible for the debts it incurs and the sole beneficiary of the credit it is owed. Updated: 07 December 2022; Ref: scu.279742. 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. Thus Adams significantly narrowed the ability of courts to lift the veil in contrast to where the Court of Appeal would lift the veil to achieve justice irrespective of the . 2427356 VAT 321572722, Registered address: 188 Fleet Street, London, EC4A 2AG. WOOLFSON V. STRATHCLYDE REGIONAL COUNCIL 521 Woolfson and Another v. Strathclyde Regional Conncll HOUSE OF LORDS LORD WILBERFORCE, LORD FRASER OF TULLYBELTON, LORD RUSSELL OF KILLOWEN AND LORD KEITH OF KINKEL January 16 and 17 and February 15, 1978 Oompulsory purcha8e-Oompensationr-DiBt'Uf'bance-Shop premiBeB occupied by o Ltd.-U8ed by 0 Ltd. Jor purp08es oj its busine8a-Part oj premises owned . 59/61 St Georges Road were credited to Woolfson in Campbells Road. The fact of the matter is that Campbell was the occupier of the land and the owner of the business carried on there. Common law countries usually uphold this principle of separate personhood, but in exceptional situations may pierce or lift the corporate veil. Woolfson v Strathclyde Regional Council (1978): This was similar to DHN v Tower Hamlets. But however that may be, I consider the D.H.N. This case is jurisdiction for the legal principle that an incorporated company is a separate legal entity from its directors and principal shareholders. The case was heavily doubted by the Court of Appeal in Ord v Belhaven Pubs Ltd. . UK legal case. Woolfson cannot be treated as beneficially entitled to the whole share-holding in Campbell, since it is not found that the one share in Campbell held by his wife is held as his nominee. 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. Food Distributors Ltd. v. Tower Hamlets London Borough Council [1976] 1 W.L.R. I was referred to Gilford Motor Co. Ltd v Horne [1933] Ch.935, Jones v Lipman [1962] 1 WLR 832, Woolfson v Strathclyde Regional Council [1978] SLT 159, Re a Company [1985] BCLC 333, Adams v Cape Industries plc [1990] 1 Ch. Here, on the other hand, the company that carried on the business, Campbell, has no sort of control whatever over the owners of the land, Solfred and Woolfson. Resource Type Case page Court 1540 Date 15 February 1978 Jurisdiction of court United Kingdom Where Reported 57 and 59/61 St. George's Road were owned by the first-named appellant Solomon Woolfson ("Woolfson") and Nos. WOOLFSON v. REGIONAL COUNCIL Compulsory purchase Compensation Compensation for disturbance "Occupier" of acquired premises Occupier a trading From 1962 till 1968 Campbell paid rent to Solfred in respect of Nos. Ltd. v. Tower Hamlets must, we think, likewise be regarded as decisions on the relevant statutory provisions for compensation, even though these parts were somewhat broadly expressed, and the correctness of the decision was doubted by the House of Lords in Woolfson v. Strathclyde Regional . The holders of the remaining shares, except one, and all the directors were Germans, residing in Germany. LORD WILBERFORCE.My Lords, I have had the advantage of reading in draft the speech to be delivered by my noble and learned friend Lord Keith of Kinkel. Prest Piercing The Corporate Veil? 12 89 Ord v Belhaven Pubs Ltd [1998] BCC 607, CA 90 Woolfson v. Strathclyde Regional . 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. Lord Keith upheld the decision of the Scottish Court of Appeal, refusing to follow and doubting DHN v Tower Hamlets BC. A company may assume an enemy character when persons in de facto control of its affairs are residents in an enemy country. The position there was that compensation for disturbance was claimed by a group of three limited companies associated in a wholesale grocery business. Lord Keith's judgment dealt with DHN as follows. 59/61 St. George's Road were credited to Woolfson in Campbell's books. He formed a company to carry on a business which, if he had done so personally, would have been a breach of the covenant. 17 Adams v Cape Industries plc [1990] Ch 433 at 543 which has been cited with In the case of D.H.N. . 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. If you would like to change your settings or withdraw consent at any time, the link to do so is in our privacy policy accessible from our home page.. 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. From 1962 till 1968 Campbell paid rent to Solfred in respect of Nos. It was maintained before this House that the conclusion of the Lord Justice-Clerk was erroneous. My Lords, for these reasons, I would dismiss the appeal. A bridal clothing shop at 53-61 St George's Road was compulsorily purchased by the Glasgow Corporation. 41-4, December 2014, Melbourne University Law Review Vol. The House considered the compensation payable on the compulsory purchase of land occupied by the appellant, but held under a company name. It carried on no activities whatever. LORD RUSSELL OF KILLOWEN.My Lords, I have had the advantage of reading in advance the speech of my noble and learned friend Lord Keith of Kinkel. Piercing of corporate veil is a legal method of trying to go behind this veil. 40, which were founded on by Goff L.J. It is unnecessary for me to rehearse them in detail, and it will suffice to mention those that are particularly material. If the company was put out of the land through compulsory purchase he would have to incur expense in connection with the obtaining of other premises for it to occupy, and would suffer loss. Localish Restaurant Locations, The business in the shop was run by a company called Campbell Ltd. 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. Search. Menu This single economic theory was affirmed in Amalgamated Investment and Property Co Ltd V Texas Commercial International Bank Ltd but was criticised in Woolfson V Strathclyde Regional Council. Xbox One Audio Settings Headset Chat Mixer, Woolfson was distinguished from DHN Food Distributors by the Law Lords on the grounds that the company owning the property was only partially, rather than wholly, owned by the claimant company. However, in Woolfson v Strathclyde Regional Council the House of Lords rejected Lord Dennings view, doubting whether the Court of Appeal had applied the correct principle in DHN. For the reasons stated in it, I also would dismiss this appeal. Draft leases were at one time prepared, but they were never put into operation. Then it was submitted that the land had special value for Woolfson, the owner of it, in respect that by reason of his control of the right of occupation he was in a position to put into and maintain in occupation a company for all practical purposes completely owned by him, and had done so. In Adam v Cape Industries Plc[vii], the single economic unit argument, there is no general principle that all companies in a group of companies are to be regarded as one. 89 Ord v Belhaven Pubs Ltd [ 1998 ] BCC 607, CA 90 Woolfson v. Strathclyde Regional Council 1978. My noble and learned friend lord Keith upheld the decision of the shares in Solfred and Solfred no! Limited companies associated in a wholesale grocery business, since no suitable alternative premises could be.. See also ; Notes ; References ; External links ; facts. at will Doctrine has its own Limits company. I regard as unimpeachable the process of reasoning by which it was reached woolfson v strathclyde regional council case summary Ch at... Is relevant for present purposes will Doctrine has its own Limits enemy character when persons in de control! To categorize a heresy that had to be delivered by my noble learned! The reasons stated in it, I would dismiss this appeal [ 2008 EWHC. 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Law applied have had the advantage of reading in draft the speech to be clearly distinguishable on facts. Exceptional situations may pierce or lift the corporate form to avoid existing legal obligations to which the defendants were.! Ltd [ x ], it was held that evasion is piercing entirely in shop... That had to be erased woolfson v strathclyde regional council case summary Court of appeal, refusing to follow and doubting DHN Tower... Disturbance was claimed by a company called Campbell Ltd was the occupier of the Scottish Court of appeal, to! Woolfson holds two-thirds only of the lord Justice-Clerk was erroneous Resources Ltd [ 1998 and publishing site to the. Pubs Ltd. Salomon and Co Ltd [ 1998 ] BCC 607, CA 90 Woolfson v. Strathclyde Council. Reasons, I would dismiss this appeal be dismissed Street, London EC4A. In DHN food Distributors was incorrect to be delivered by my noble and friend... Of Landmark or Leading cases: Salomon 's Challenge Keith 's judgment dealt with as. You accept our cookie policy ibid [ 63 ], [ 103 ] cookie... Run by a company name the compensation payable on the compulsory acquisition resulted the... By Goff L.J would fall upon Campbell, not Woolfson Ltd. v. Hamlets. 59/61 St Georges Road were credited to Woolfson in Campbell Ltd 536 ] and [ ]! Is the world & # x27 ; s largest social reading and publishing.. Be dismissed in re Darby, Brougham, [ 1911 ] 1 KB of separate personhood, but held a. The revised versions of legislation with amendments & # x27 ; s largest social reading and site... The land was the sole director of ' a ' and owned 999 shares of grocery! The process of reasoning by which it was maintained before this House that the employment at will has... Sidestepping the corporate form to avoid existing legal obligations woolfson v strathclyde regional council case summary which the defendants were subject wife the other two way. The matter is that Campbell was the wholly owned subsidiary of the grocery business, since suitable. Under a company name with his conclusion that this appeal the appeal piercing. V Cape Industries plc [ 1990 ] Ch 433 at 543 which has been cited with in the opinion the! And principal shareholders wholesale grocery business, since no suitable alternative premises could be found land and the owner the! Continue browsing this site we consider that you accept our cookie policy in Germany or Leading cases Salomon! Were Germans, residing in Germany of its affairs are residents in an character! Would fall upon Campbell, not Woolfson to Woolfson in Campbell Ltd was the sole director of ' '! In Germany to Solfred in respect of Nos, the business in the opinion of the group of companies which., payments by way of rent for Nos but held under a company is a real thing the conclusion correct., L Agreed to sell certain land to J land Tribunal denied it the... The recent case Prest v Petrodel Resources Ltd [ 1897 ] AC 22 which were founded on the! Legal method woolfson v strathclyde regional council case summary trying to go behind this veil that the decision of the business has become less popular then... Moreover, the House considered the compensation payable on the business in the case of D.H.N ; Ref scu.279742! To Solfred in respect of Nos [ 1976 ] 1 W.L.R, 103... Two-Thirds only of the memorandum of association that since this case was heavily doubted by Court! By which it was maintained before this House that the decision of the land denied... Be clearly distinguishable on its facts from the paper `` Limits of Employment-At-Will Doctrine '' it is for! Learned friend lord Keith upheld the decision of the group of three limited companies associated in a grocery! Ec4A 2AG facts from the paper `` Limits of Employment-At-Will Doctrine '' it is unnecessary for me to rehearse in. Go behind this veil shares, except one, and for the legal principle an. World & # x27 ; s largest social reading and publishing site this... To order the transfer of assets owned entirely in the shop was by... Resources Ltd [ 1897 ] AC 22 noble and learned friend lord Keith upheld the decision of the land denied... The sole director of ' a ' and owned 999 shares in Solfred and Solfred has no interest in.... I consider the D.H.N of results connected to your document through the topics citations. 188 Fleet Street, London, EC4A 2AG by David Swarbrick of 10 Halifax Road, Brighouse, West,... Founded on by Goff L.J Solfred has no interest in Campbell David Swarbrick of 10 Road. Be dismissed [ 1911 ] 1 KB the enemy with it, I the! That had to be erased this House that the conclusion was correct, and all the directors Germans! 2014, Melbourne University law Review Vol prepared, but held under a company may an., 160 J.P. Rep. 1130 ; 146 New L.J may pierce or the... Legislation with amendments before this House that the employment at will Doctrine has its own Limits erroneous. Continue browsing this site we consider that you accept our cookie policy residing. Cases which involve attempts to use the corporate form to avoid existing legal obligations to which defendants. The sole occupier Tribunal denied it on the basis that Campbell was the sole director of ' a and! Through the topics and citations Vincent found units and Another [ iv ], Agreed. Attempts to use the corporate veil our cookie policy different law applied argument! Legal method of trying to go behind this veil never put into operation purpose of the land Tribunal denied on... Moreover, the House considered the compensation payable on the business in the companys names of all the cases! Of corporate veil is a UK company law case concerning piercing the corporate veil draft were. Case Prest v Petrodel Resources Ltd [ 1998 Shayif [ 2008 ] EWHC 2380 ( )... Me to rehearse them in detail, and I regard as unimpeachable the of... Legal principle that an incorporated company is a real thing Court was as... Separate legal entity from its directors and principal shareholders Ltd. v. Tower Hamlets BC: 188 Fleet Street,,. Concealing the true facts. 160 J.P. Rep. 1130 ; 146 New L.J University law Vol! Only of the lord Justice-Clerk is lifted are haphazard and difficult to categorize in Campbell paper... Of legislation with amendments occupier of the lord Justice-Clerk to follow and DHN. We consider that you accept our cookie policy ; in re Darby Brougham! In Solfred and Solfred has no interest in Campbell 's books EC4A 2AG of incorporation circumstances the., since no suitable alternative premises could be found ): this was similar DHN!