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    The document discusses three cases where members of a company were held liable for the company's actions or debts. In the first case, Gliford Motor Co v Horne, an injunction was granted against both a company and its member for breaching an agreement. In the second case, Smith, Stone & Knight Ltd v Birmingham Corporation, a waste company was found to be a tool of its controlling member, so the member was entitled to compensation. In the third case, Adam v Cape Industries plc, the court held it could lift the veil of incorporation only if the company was proven to be a sham or facade.

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    The document discusses three cases where members of a company were held liable for the company's actions or debts. In the first case, Gliford Motor Co v Horne, an injunction was granted against both a company and its member for breaching an agreement. In the second case, Smith, Stone & Knight Ltd v Birmingham Corporation, a waste company was found to be a tool of its controlling member, so the member was entitled to compensation. In the third case, Adam v Cape Industries plc, the court held it could lift the veil of incorporation only if the company was proven to be a sham or facade.

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    23 views1 page

    Judicial

    Uploaded by

    mimiemiloes
    The document discusses three cases where members of a company were held liable for the company's actions or debts. In the first case, Gliford Motor Co v Horne, an injunction was granted against both a company and its member for breaching an agreement. In the second case, Smith, Stone & Knight Ltd v Birmingham Corporation, a waste company was found to be a tool of its controlling member, so the member was entitled to compensation. In the third case, Adam v Cape Industries plc, the court held it could lift the veil of incorporation only if the company was proven to be a sham or facade.

    Copyright:

    Attribution Non-Commercial (BY-NC)
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    Use Of Company To Evade Legal Obligations @ To Commit Fraud -the members can be made liable.

    Case: Gliford Motor Co v Horne Held: The court granted injuction againts both Horne & his company having held that he had breached his agreement.

    Company Employed As An Agent @ Alter Ego Of Its Controllers -members can be made liable for companys liability. Case: Smith, Stone & Knight Ltd v Birmingham Corporation. Held: the waste company was a tool of Smith. The occupation of the premises by the waste company was Smiths business. Therefore, Smith was entitled for compensation.

    Where The Company Is A Sham @ Mere Facade Concealing The True Facts. GR : where the company is a sham or mere facade designed to conceal the true state of affairs, the court may lift the veil and treats it as one with the members. Case: Adam v Cape Industries plc. Held: Court have no discretion to lift the veil of incorporation unless it is shown that the companies concerned are a sham or facade.

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