Law Of Business Corporate - Free Samples - Myassignmenthelp.Com

Question: Discuss about the Law Of Business Corporate. Answer: Directing mind and will A company is not a natural person. It is an artificial person which is incorporated by its members the company has a separate legal entity and rights and duties like a natural person which are different from his members but simultaneously it can merely perform through its members. The key personnels of the company are known as directors who regulate the company and considered as mind and will of the company. Their capability to tie a company originates from the contract of the agency. Through the express actual authority, implicit actual control or apparent authority An employee can also bind the corporation. If an employee of the company has taken an action beyond its power, but the corporation desire to be tied to the act of the employee, such company can give approval to such act of the employee. The Western Australian Supreme Court recently gave the decision related to a key personnels liability for the action of the company in situations where the company was prosecuted by investors that lost their assets in an investment plan (Sugarloaf Hill Nominees Pty Ltd v Rewards Projects Ltd(2011)WASC). The Supreme Court of Victoria held that the senior person is the directing mind and will of a company whose power is derivative from the company's board of directors who will perform for the company and for the interest of the company or any employee can be the companies mind and will if such employee performs under the authority (ABC Development Learning Centres Pty Ltd v Wallace(2006)VSC 171). Lifting theCorporateVeil A corporation has distinguished legal personality and they cannot be entitled to the liabilities of the company, not more than its stake( SalomonvASalomonandCoLtd(1897) AC22) But simultaneously, a company a juristic person whose all the decisions are taken are by its directors and stakeholders. In the case of lifting the corporate veil, the court struck down the limited liability part and held all directors and shareholders of the company individually liable for companys activities. The court did not consider the separate personality of the company and make the stakeholders responsible for the act of such body like such activities were done by the stakeholders. The piercing and lifting of the corporate veil are different processes in which piercing is considering the right and responsibility of company as stakeholders rights and responsibility. Lifting is observing beyond the company to identifying the stakeholders, for the lawful purpose (AtlasMaritimeCoSAvAvalonMaritimeLtd(No1)(199 1)4AllER769) The need of such process known as lifting the corporate veil came into existence because the company was using corporate veil as a shield to defend themselves. The reasons behind piercing the corporate veil contain recognition of actual owners, deception, injustice, and observing members liability when the responsibility arises. In the current instance, the court has laid down the need of the doctrine of piercing of corporate veil to reduce the cases related to fraud where members of the company are using limited liability clause as a shield (PrestvPetrodelResourcesLtd(2013)2AC415.) References ABC Development Learning Centres Pty Ltd v Wallace(2006)VSC 171 Sugarloaf Hill Nominees Pty Ltd v Rewards Projects Ltd(2011)WASC SalomonvASalomonandCoLtd(1897) AC22PrestvPetrodelResourcesLtd(2013)2AC415.AtlasMaritimeCoSAvAvalonMaritimeLtd(No1)(1991)4AllER769.