Salmon Vs. The On The Veil Of Incorporation Essay

Salmon Vs. The On The Veil Of Incorporation Essay

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In the following essay salmon v salmon will be used to analyse the bases of principle or test used to determined when the veil will be pierced in relation to statute or the court. Firstly, I would also like to examine the case of salmon v salmon in respect to the three principle that have provided a foundation to lifting the veil of incorporation. Follow by critical analysis of key terms that may be used to examine the cases that will be discussed. Finally, we will use salmons’ v salmon and subsequent cases and statues to analyse the three principle or test used to determined when the veil will be pierced.

Firstly, definition for veil of incorporation is the separation of company from its members and the meaning to lift or to pierced would mean members are revealed and made responsible for their action (Kelly et al 2014).One example for lifting the veil under statute is in relation to section 93(5) of the companies’ ordinance and section 26 of bills of exchange ordinance. This was explored in the case of Cheung Yiu wing v blooming textiles (1975) two cheques were issue by company to the creditor, the cheque contains the name of company and the signatures of two directors but it has no indication that the director was signing “for” or on behalf of company hence in this case the judge stuck to the legislation word for word. In a similar case of Kwok Wing v Maytex co (1977) but in this case it was clear that Kwok was signing on behalf of the company which lead to lifting of veil. Another case which backs up find in the case of Kwok wing is that in Jenice ltd v Dan (1993) in this case even if name is misspelt as long as the creditor knows the true intention then the director is not liable for the cheques, lastly the case of British a...


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...9) they all formed a company with vision of fraud, the only difference is the case regarding creasy v Brench motor limited (1992), it was already in business as a fraud.

In Conclusion drawing from all the information above we can analyse that it is uncertain when the veil of corporation will be lifted. Reason could be due to the way judges interpret information, clarity of statues, conflict between principals and methods. However, that does not mean it’s not a single principle or method due to new method are constantly been developed for example the case in smith stone & knight ltd v Birmingham corporation (1938) and the unyielding rock of Solomon which is still been referred back to as the basis in the corporate veil. Therefore, it will not be possible in the short run it will not be possible however it does not represent it may not be possible in the near future.

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