This argument was rejected by the court for the reasons given in the opinion of the Lord Justice-Clerk. We also use third-party cookies that help us analyze and understand how you use this website. Salomon v Salomon (1897) A.C. 22 (H.L.) Lord Keith's judgment dealt with DHN as follows. What people are saying - Write a review. 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. that in the circumstances Bronze held the legal title to the premises in trust for D.H.N., which also sufficed to entitle D.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. Nos. During the First World War, the English company commenced action for recovery of a trade debt. Woolfson v Strathclyde Regional Council (1978): . 39 Referring to the opinion of Lord Keith in Woolfson v. Strathclyde Regional Council (6), they pointed out that that exception is ([1978] SLT at 161) ". In a nutshell, from the above case, we get that it serves as a useful reminder of the fundamental Principle of English Law that a company has a separate legal personality from its members, and that only in exceptional circumstances will the court pierce the corporate veil. Find something interesting to watch in seconds. Woolfson V Strathclyde Regional Council: Editors: Jesse Russell, Ronald Cohn: Publisher: Book on Demand, 2012: ISBN: 5512263587, 9785512263587: 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. 116. Facts; Judgment; See also; Notes; References; External links; Facts. Woolfson v Strathclyde Regional Council (1979) 38 P & CR 521 Wrexham Maelor Borough Council v MacDougall [1993] 2 EGLR 23 Wrotham Park Settled Estates v Hertsmere Borough Council [1993] 2 EGLR 15 Page No(s) 106, 205 69, 172 195, 201 44 116, 208 42 83 115 55 119 50 114 214 126 20 81, 209 21, 68, 73, 75, 82, 84, 97, 185, 187, 201, 212 66 163 8 . Resource Type Case page Court 1540 Date 15 February 1978 Jurisdiction of court United Kingdom Where Reported Therefore, English courts have shown a strong determination not to embark on any development of a group enterprise law. He referred to a passage in the judgment of Ormerod L.J. Case: Woolfson v Strathclyde Regional Council [1978] UKHL 5 Prest v Petrodel Resources Ltd & ors [2013] WTLR 1249 Wills & Trusts Law Reports | September 2013 #132 Michael Prest (husband) and Yasmin Prest (wife) were married for 15 years and had four children before the wife petitioned for divorce in March 2008. 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. 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. The compulsory acquisition resulted in the extinction of the grocery business, since no suitable alternative premises could be found. 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. Food Distributors Ltd. v. Tower Hamlets London Borough Council[1976] 1 W.L.R. 53/55 St. George's Road. Jones v. Lipman and Another[iv], L Agreed to sell certain land to J. Sonic Breakfast Burrito Review, 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. 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. All rights reserved. This followed the refusal by the court to allow Campbell and Mrs Woolfson to be joined as additional claimants in the proceedings. 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 . (160), 20Adam (n.18) [536] and [542]. Subscribers can access the reported version of this case. Court case. From 1962 till 1968 Campbell paid rent to Solfred in respect of Nos. The Land Tribunal denied it on the basis that Campbell Ltd was the sole occupier. VTB Capital plc v Nutritek International Corp [2013] UKSC 5. 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. 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. (155) Ibid 561-2, 564. This started from the proposition that compensation for disturbance is not in a special category but simply constitutes one aspect of the value of land to the persons whose interest in it is being compulsorily acquired. Localish Restaurant Locations, The issued share capital of Campbell was 1,000 shares, of which 999 were held by Woolfson and one by his wife. Woolfson v Strathclide UKHL 5 . In Canada, the case of Ernst v. EnCana Corporation was inspired by the rule of Rylands v Fletcher. Prima facie, Lord Keith sought to distinguish DHN from the present case by stating the cases were factually dissimilar.Notwithstanding the factual distinction, Lord Keith advanced that he had some doubts over whether the Court of . However there are many such situations and this paper hashighlightedfew of them. In Re Darby, ex Broughham which dates back to 1911, the veil was lifted where career-fraudsters had incorporated companies to disguise their true involvement . The leading case is Cape Industries. In-text: (Woolfson v Strathclyde Regional Council, [1978]) Your Bibliography: Woolfson v Strathclyde Regional Council [1978] EGLR 2, p.19. 2 Salomon v A Salomon and Co Ltd [1897] AC 22. in support of this ground of judgment and, as to the first of them, to some extent also by Lord Denning, M.R., do not, with respect, appear to me to be concerned with that principle. , August 2019, Journal of Law and Society Nbr. 59/61 St. George's Road were credited to Woolfson in Campbell's books. To browse Academia.edu and the wider internet faster and more securely, please take a few seconds toupgrade your browser. It is unnecessary for me to rehearse them in detail, and it will suffice to mention those that are particularly material. 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. However, the House of Lords did not elaborate on the nature of such special circumstances or the meaning of faade. A company may assume an enemy character when persons in de facto control of its affairs are residents in an enemy country. It is unnecessary for me to rehearse them in detail, and it will suffice to mention those that are particularly material. A bridal clothing shop at 53-61 St George's Road was compulsorily purchased by the Glasgow Corporation. In re FG (films) Ltd[ii], FG films wanted Monsoon registered as a British film. 2. 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. Subscribers are able to see a visualisation of a case and its relationships to other cases. Note that since this case was based in Scotland, different law applied. (H.L.) These premises were owned by Bronze, which had originally been the wholly owned subsidiary of a bank which had advanced money for the purchase of the premises, but which had later become the wholly owned subsidiary of D.H.N. 961; [1996] CLC 990; (1996), 160 J.P. Rep. 1130; 146 New L.J. 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. 54 88 D Hayton, 'Contractual Licences and Corporate Veils' [1977] C.L.J. But however that may be, I consider the D.H.N. 95 (Eng.) Food Distributorscase (supra) was distinguishable. Even Evasion can be considered as Faade only. I agree with it and with his conclusion that this appeal be dismissed. Founded over 20 years ago, vLex provides a first-class and comprehensive service for lawyers, law firms, government departments, and law schools around the world. The DHN case approach has become less popular since then. 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. (H.L.) 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 business in the shop was run by a company called Campbell Ltd. Some of our partners may process your data as a part of their legitimate business interest without asking for consent. The issued share capital of Campbell was 1,000 shares, of which 999 were held by Woolfson and one by his wife. 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. It is unnecessary for me to rehearse them in detail, and it will suffice to mention those that are particularly material. Statutes Noticed: Expropriation Act, R.S.B.C. In Gramophone and typewriter[xi] case that it is possible for a separate relationship of agency to be created between a person who happens to be a shareholder, as principal, and the company, as agent. 40, which were founded on by Goff L.J. 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. Woolfson holds two-thirds only of the shares in Solfred and Solfred has no interest in Campbell. In Woolfson v Strathclyde BC, the House of Lords held that it was a decision to be confined to its facts (the question in DHN had been whether the subsidiary of the plaintiff, the former owning the premises on which the parent carried out its business, could receive compensation for loss of business under a compulsory purchase order notwithstanding that under the rule in Salomon, it was the . Woolfson v Strathclyde Regional Council: HL 15 Feb 1978 - swarb.co.uk 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. Nos. 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. that the group was entitled to compensation for disturbance as owners of the business. Copyright 2020 Lawctopus. 59/61 St Georges Road were credited to Woolfson in Campbells Road. This line of argument was unsupported by authority and in my opinion it also lacks any foundation of principle. However, in Woolfson v.Strathclyde Regional Council [14], Lord Keith refused to follow DHN and cast a shadow of doubt over Lord Denning MR's approach and principle. Dr Wallersteiner had bought a company . Horne. Further, the decisions of this House in Caddies v Harold Holdsworth & Co (Wake-field) Ltd 1955 S.C. 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. instance of. Topic 3 Corporate Personality 1 PART A SEPARATE LEGAL PERSON PRINCIPLE 2 The Salomon case: separate legal entity Company is a legal to compensation for disturbance. Corporate structures, the veil and the role of the courts. The Land Tribunal denied it on the basis that Campbell Ltd was the sole occupier. PDF Lifting, Piercing and Sidestepping the Corporate Veil Ord v Belhaven Pubs Ltd [1998 . Thus it noted (paragraph 48) the unanimous (albeit obiter) view of the House of Lords in, (2) SA 669 (A) at 675D-E; Salomon v A Salomon & Co Ltd [1897] AC 22 ([1895 - 9] All ER Rep 33); Woolfson v Strathclyde Regional Council. Indeed, in Woolfson v Strathclyde Regional Council 1978 . From 1962 till 1968 Campbell paid rent to Solfred in respect of Nos. . Upon Report from the Appellate Committee, to whom was referred the Cause Woolfson and others against Strathclyde Regional Council (as Successors to The Corporation of the City of Glasgow), That the Committee had heard Counsel, as well on Monday the 16th as on Tuesday the 17th, days of January last, upon the Petition and Appeal of (one) Solomon Woolfson, 30 Restan Road, Newlands, Glasgow and (two) Solfred Holdings Limited, a Company incorporated under the Companies Acts and having their Registered Office at 18/28 Woodlands Road, Glasgow, praying, That the matter of the Interlocutor set forth in the Schedule thereto, namely, an Interlocutor of the Lords of Session in Scotland, of the Second Division, of the 3rd of December 1976, might be reviewed before Her Majesty the Queen, in Her Court of Parliament, and that the said Interlocutor might be reversed, varied or altered, or that the Petitioners might have such other relief in the premises as to Her Majesty the Queen in Her Court of Parliament, might seem meet; as also upon the case of Strathclyde Regional Council (as Successors to the Corporation of the City of Glasgow), lodged in answer to the said Appeal; and due consideration had this day of what was offered on either side in this Cause: It is Ordered and Adjudged, by the Lords Spiritual and Temporal in the Court of Parliament of Her Majesty the Queen assembled, That the said Interlocutor of the 3rd day of December 1976, complained of in the said Appeal, be, and the same is hereby, Affirmed, and that the said Petition and Appeal be, and the same is hereby, dismissed this House: And it is further Ordered, That the Appellants do pay, or cause to be paid, to the said Respondents the Costs incurred by them in respect of the said Appeal, the amount thereof to be certified by the Clerk of the Parliaments: And it is also further Ordered, That unless the Costs, certified as aforesaid, shall be paid to the party entitled to the same within one calendar month from the date of the Certificate thereof, the Cause shall be, and the same is hereby, remitted back to the Court of Session in Scotland, or to the Judge acting as Vacation Judge, to issue such Summary Process or Diligence for the recovery of such Costs as shall be lawful and necessary. 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