Piercing On Corporate Groups In Australia †Myassignmenthelp.Com

Question: Discuss About The Piercing On Corporate Groups In Australia? Answer: Introducation Directing mind and will is a phrase that is associated with the officers of the company who are considered to be the minds of a company. When any company is formed then it acquires all the features of a natural person and is established in (Salomon v A Salomon Co Ltd, 1896). The officers of the company are distinct from the company and the acts of the company are considered to be its own and no repercussion falls upon the officers who acts as the agents of the company and is held in (Lee v Lee's Air Farming Ltd , 1960). (Tomasic, Bottomley, McQueen, 2002) But, whether every person who is acting on behalf of company can be considered as the directing mind and will of the company. Can every employee or client who is associated with the company is the directing mind and will of the company. The answer is No. It is held in (Krakowski v Eurolynx Properties Ltd, 1995), that those officers who encompass and acts in order to fulfill the objects and aims of the company are considered to be the directing mind and will of the company. These are the persons who are authorized to achieve the purpose of the company and are entitled to undertake actions on behalf of the company. The acts that are carried out by theses directing mind and will official are binding upon the company and the company must honor such acts considering the same as its own. (Tunstall, 2008) Piercing the Corporate Veil Piercing the corporate veil is the phrase which symbolizes a situation where in the distinct personality of the company is disregarded by the court and the distinction amid the company and its officers is mitigated and the acts of the directors are held to be his acts personally and not the acts of the company.(Eroglu, 2008) When a company is formed then it has a distinct legal personality, that is, the acts of the directors are considered as the acts of the company and any liability arising there from will be considered as the acts of the company (Lennards Carrying Co Ltd v Asiatic Petroleum Co Ltd, 1915). But, when there are cases of fraud or sham or presence of enemy element or corporate group or agency, then, this distinct personality is disregarded by the courts and the veil that makes a distinction amid the company and its officers is distended and the veil is pierced (Industrial Equity Ltd v Blackburn , 1977) and (James Hardie, 1989). (Helen, 2009) When the veil is pierced the repercussion of the acts of the company does not fall upon the company and the director is held personally liable for the same. The acts of the company become the acts of the directors and they can beheld personally liable to make the good the loss caused by them. Thus, the piercing of corporate veil is a very important concept in order to bring justice. References Eroglu, M. (2008). Multinational Enterprises and Tort Liabilities: An Interdisciplinary and Comparative Examination. Edward Elgar Publishing. Helen, A. (2009). Piercing the Veil on Corporate Groups in Australia: The Case for Reform" . Industrial Equity Ltd v Blackburn (1977). James Hardie (1989). Krakowski v Eurolynx Properties Ltd (1995). Lee v Lee's Air Farming Ltd (1960). Lennards Carrying Co Ltd v Asiatic Petroleum Co Ltd (1915). Salomon v A Salomon Co Ltd (1896). Tomasic, R., Bottomley, S., McQueen, R. (2002). Corporations Law in Australia. Federation Press. Tunstall. (2008). Corporate Responsibility: The duties and liabilities of the corporation.