By piercing the corporate veil, are you a widow-maker?

The legal principle that an entity once incorporated takes on its own separate legal persona was established by the House of Lords in Salomon v Salomon (1897) and means that a company has a separate legal identity from that of its shareholders. The personalisation of the corporation can be traced back to Roman law where a new legal entity became the equivalent of a person in the eyes of the law, a legal persona or mask eriptur persona, manet res. The notion that the entity not the shareholders, owns the assets and liabilities revolves around the separate entity principle and is the basis for the concept of shareholder limited liability. Shareholders cannot be held liable for a companys debts beyond their personal capital investment and cannot have a proprietary interest in the companys assets ... READ MORE

Flora Gilkison ACIS - Released by NZLawyer - 21 September 2012