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Macaura's case is depending upon the fact that Company whether private or public is distinct from his owner if he took the policy from insurance company at the name of company then he could claim for damages. Only Macaura’s company, as owner of the timber, which had the requisite insurable interest in it.Only the company, and not Macaura, could insure its property against loss or damage.These are the exceptions to the rule in Salomon’s Case, when the corporate veil is lifted and the reality of the situation is examined.It was held that As soon as citizens form a company, the rights guaranteed to them by article 19(1)c has been exercised and no restraint has been placed on the right and no infringement of that right is made.The principle in Salomon’s Case that a company is a legally different person from those who control it represents the current law in Ireland.For example, if I form a company called ‘Murphy & Co Ltd’ in which I own one hundred per cent of the shares and am a director and employee, legally speaking the company and myself are two distinct people.But in certain exceptional cases the Court is entitled to lift the veil of corporate entity and to pay regard to the economic realities behind the legal facade.

The company carried the business of felling and milling timber. Macaura had earlier insured the timber against loss of by fire in his own name. He subsequently sold the plantation to a company of which he was the only shareholder, through the purchase money remained owing to him.A corporation is a separate legal entity from its owners.In other words, if a corporation, in the course of doing business, is involved in any legal action, then the corporation, for legal purposes, is its own person.Once a company or corporation is formed, the business which is carried on by the such company or corporation is the business of that company or corporation and is not the business of the citizens who get the company or corporation incorporated and the rights of the incorporated body must be judges on that footing and cannot be judged on the assumption that they are the rights attributed to the business of individual citizens.The court held that the income-tax authorities were entitled to pierce the veil of corporate entity and to look at the reality of the transaction to examine whether the corporate entity was being used for tax evasion.

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