The grounds for the decision were (1) that since D.H.N. (49) Woolfson v. Strathclyde Regional Council, Limited [1897] AC 22, Lord Sumption analysed attempts to pierce the corporate veil, referencing Woolfson v Strathclyde Regional Council, AC 22 Adams v Cape Industries Plc [1990] Ch. 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. This was supported by a copious citation of authority, but I do not consider the proposition as such to be in any doubt. I agree with it and with his conclusion that this appeal be dismissed. Nos. WOOLFSON v. REGIONAL COUNCIL Compulsory purchase Compensation Compensation for disturbance "Occupier" of acquired premises Occupier a trading They had twenty and ten shares respectively in Solfred Ltd. Mr Woolfson and Solfred Ltd claimed compensation together for loss of business after the compulsory purchase, arguing that this situation was analogous to the case of DHN v Tower Hamlets LBC.[1]. Woolfson v. Strathclyde Regional Council 1978 S.L.T. This website uses cookies to improve your experience while you navigate through the website. LORD KEITH OF KINKEL.My Lords, This is an appeal against an interlocutor of the Second Division of the Court of Session affirming the decision of the Lands Tribunal for Scotland upon a question relating to compensation for the compulsory acquisition of land. We and our partners use cookies to Store and/or access information on a device. 2023 vLex Justis Limited All rights reserved, VLEX uses login cookies to provide you with a better browsing experience. IMPORTANT:This site reports and summarizes cases. 17]. There the company that owned the land was the wholly owned subsidiary of the company that carried on the business. 33 (1), sect. A bridal clothing shop at 53-61 St George's Road was compulsorily purchased by the Glasgow Corporation. LORD FRASER OF TULLYBELTON.My Lords 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. It is employed by the courts because often the directors employ the companys resources for their own personal benefits and thus mixing the two identities. 0 references. ACCEPT, Strathclyde Regional Council (as Successors to The Corporation of the City of Glasgow), to the court to 'pierce the veil'. Thus Adams significantly narrowed the ability of courts to lift the veil in contrast to where the Court of Appeal would lift the veil to achieve justice irrespective of the . 40, which were founded on by Goff L.J. All E.R. VTB Capital plc v Nutritek International Corp [2013] UKSC 5. The circumstance that Solfred owned a substantial part of the shop premises was for purposes of this argument dismissed as irrelevant, on the basis that the part of the premises owned by Woolfson was essential to the carrying on of Campbells business, so that without it the business would have to be carried on, if at all, at some completely different place. PDF Lifting, Piercing and Sidestepping the Corporate Veil Ord v Belhaven Pubs Ltd [1998 . 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. But the shop itself, though all on one floor, was composed of different units of property. 21Ben Hashem v Shayif [2008] EWHC 2380 (Fam) [159] - [164]. Advanced A.I. How does the decision in DHN Food Distributors Ltd v Tower Hamlets LBC [1976] 1 WLR 852 compare with the decision in Woolfson v Strathclyde Regional Council 1978 SLT 159? The leading case is Cape Industries. Note that since this case was based in Scotland, different law applied. to compensation for disturbance. Im a simple gal who loves adventure, nature He said that DHN was easily distinguishable because Mr Woolfson did not own all the shares in Solfred, as Bronze was wholly owned by DHN, and Campbell had no control at all over the owners of the land. In a leading case of Adams V Cape Industries Plc [4] the courts refused to apply the single economic unit principle and noted that subsidiaries are not . I agree with it, and for the reasons he gives would dismiss the appeal. Menu 22Woolfson v Strathclyde Regional Council. Therefore, English courts have shown a strong determination not to embark on any development of a group enterprise law. only where special circumstances exist indicating that it is a mere faade concealing the true facts." Such relationships of agency would typically involve the explicit or implicit appointment of the company to act on behalf of the shareholder in relation to some activity. Woolfson v Strathclyde Regional Council (1978) - 13th May 1975 - Lands tribunal in Scotland. I agree with it and with his conclusion that this appeal be dismissed. What people are saying - Write a review. 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. It is unnecessary for me to rehearse them in detail, and it will suffice to mention those that are particularly material. (157) Ibid 562. 95 (Eng.) Mr Solomon Woolfson owned three units and another company, Solfred Holdings Ltd owned the other two. Piercing the corporate veil or lifting the corporate veil is a legal decision to treat the rights or duties of a corporation as the rights or liabilities of its shareholders. It was maintained before this House that the conclusion of the Lord Justice-Clerk was erroneous. 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 . The business in the shop was run by a company called Campbell Ltd. 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. But the shop itself, though all on one floor . From 1952 until 1963, when Schedule A taxation was abolished, payments by way of rent for Nos. The business in the shop was run by a company called Campbell Ltd. Search. Woolfson v Strathclyde Regional Council (1978) where he described this exception as 'the principle that it is appro-priate to pierce the corporate veil only where special circumstances exist indicating that it is a mere facade concealing the . 1 reference. In Woolfson v. Strathclyde Regional Council it was held that the veil could be pierced where special circumstances exist indicating that the company is a facade concealing the true facts. The House considered the compensation payable on the compulsory purchase of land occupied by the appellant, but held under a company name. 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. Here, on the other hand, the company that carried on the business, Campbell, has no sort of control whatever over the owners of the land, Solfred and Woolfson. . The case was heavily doubted by the Court of Appeal in Ord v Belhaven Pubs Ltd. . An alternative to lists of cases, the Precedent Map makes it easier to establish which ones may be of most relevance to your research and prioritise further reading. 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. Sorry, preview is currently unavailable. Woolfson v Strathclyde Regional Council (1978): This was similar to DHN v Tower Hamlets. The argument is in my opinion unsound, and must be rejected. (155) Ibid 561-2, 564. View Notes - Spring+2015+ACCT4610+Topic+3 from ACCT 4610 at HKUST. 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. Salomon v Salomon (1897) A.C. 22 (H.L.) Woolfson v Strathclyde Regional Council [1978] UKHL 5 is a UK company law case concerning piercing the corporate veil. 12 89 Ord v Belhaven Pubs Ltd [1998] BCC 607, CA 90 Woolfson v. Strathclyde Regional . Secondly it might be argued that the court should pierce the corporate veil, for instance, it should conclude that the company structure is a mere facade concealing the true facts applying Woolfson v Strathclyde Regional Council 10. Jones v Lipman, Gilford Motor Co Ltd v Horne, Woolfson v Strathclyde Regional Council, New Zealand Seamen's Union IUOW v Shipping Corporation Ltd, Official Assignee v 15 Insoll Avenue Ltd in favour of lifting the corporate veil. Facts. And one of them is to subscribe to our newsletter. We also use third-party cookies that help us analyze and understand how you use this website. Woolfson holds two-thirds only of the shares in Solfred and Solfred has no interest in Campbell. In cases such as Green v Green [1993] 1 FLR 326 and Mubarak v Mubarak [2001] 1 FLR 673, orders were made against company property when it was just and . Mr Woolfson had 999 shares in Campbell Ltd and his wife the other. He formed a company to carry on a business which, if he had done so personally, would have been a breach of the covenant. Campbell was throughout shown in the valuation roll as occupier of the shop premises, but its occupation was not regulated by lease or any other kind of formal arrangement. Lists of cited by and citing cases may be incomplete. Lords Wilberforce, Fraser and Russell and Dundy concurred. In times of war it is illegal to trade with the enemy. V, January 2019. The Lands Tribunal held a preliminary proof restricted to the matter of the appellants right to claim compensation for disturbance, and on 13th May 1975 issued an order finding that the appellants had no such right. UK legal case. There can be no doubt, and it is not now disputed by the appellants, that Campbell was throughout the occupier of the shop premises and that the business carried on there was that of Campbell. and the premises were its only asset. The leading case is Cape Industries. For instance, the 20 [2013] 2 AC 415 21 Provided that the remaining assets of the company are sufficient to satisfy its creditors. technology developed exclusively by vLex editorially enriches legal information to make it accessible, with instant translation into 14 languages for enhanced discoverability and comparative research. wgci past radio personalities; auto sear jig legal 5 minutes know interesting legal mattersWoolfson v Strathclyde Regional Council [1978] 2 EGLR 19 (HL) (UK Caselaw) 40 Nbr. From 1962 till 1968 Campbell paid rent to Solfred in respect of Nos. Piercing of corporate veil is a legal method of trying to go behind this veil. After the case . A bridal clothing shop at 53-61 St George's Road was compulsorily purchased by the Glasgow Corporation. [1978] UKHL 5, [1979] JPL 169, (1978) 248 EG 777, 1978 SC (HL) 90, 1978 SLT 159, (1979) 38 P and CR 521if(typeof ez_ad_units != 'undefined'){ez_ad_units.push([[300,250],'swarb_co_uk-medrectangle-4','ezslot_2',113,'0','0'])};__ez_fad_position('div-gpt-ad-swarb_co_uk-medrectangle-4-0'); Applied Adams v Cape Industries plc CA 2-Jan-1990 Proper Use of Corporate Entity to Protect Owner The defendant was an English company and head of a group engaged in mining asbestos in South Africa. The latter was in complete control of the situation as respects anything which might affect its business, and there was no one but itself having any kind of interest or right as respects the assets of the subsidiary. 3 Woolfson v. Strathclyde Regional Council [1978] SLT 159, confirmed by the Court of Appeal in Adams v. Cape Industries Plc [1990] 2 WLR 657. Two-Thirds only of the shares in Campbell to our newsletter UKHL 5 is a UK company law case concerning the! 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