Business Law Assignment: Corporate Veil, Liability, and Directing Mind

This report delves into key aspects of business law, focusing on the concepts of corporate veil, corporate liability, and the 'directing mind and will' of a corporation. It examines the legal distinctions between a corporation and its members, highlighting the responsibilities of directors and the legal implications of their actions. The report references cases such as Sugarloaf Hill Nominees Pty Ltd v Rewards Projects Ltd and ABC Development Learning Centres Pty Ltd v Wallace to illustrate the application of these principles. It further explores the concept of 'lifting the corporate veil,' discussing instances where courts may disregard the separate legal entity of a corporation to hold its members accountable. The report references cases like Atlas Maritime Co SA v Avalon Maritime Ltd and Prest v Petrodel Resources Ltd to exemplify scenarios where piercing the corporate veil is warranted to address issues such as fraud and injustice. Overall, the report provides a comprehensive overview of corporate law principles concerning the legal responsibilities of corporations, directors, and members, along with the circumstances under which those responsibilities are enforced.

Running Head: BUSINESS LAW ASSIGNMENT
Business law assignment

BUSINESS LAW ASSIGNMENT 1
Directing mind and will
A corporation has a separate legal entity which are different from its members and it is
incorporated by its own member and considered as an artificial person it can purely work via its
the members. The important persons who take most of the decision are known as key
personnels. The directors regulate all the activities and will be known as mind and will of the
body. their ability related to binding the company diprives from the agency. An employee by
the, implicit actual control, apparent authority or actual authority can tie the corporate body it’s
the pure discretion of the company whether such act action has taken by the employee of the
company and that too beyond it power can get approval or not.
the Western Australian Supreme Court recently took the decision with regard to the
liability of the key personals’ for the act of the corporation in the case where the investor of the
company lost their properties due to the investment scheme of the company(Sugarloaf Hill
Nominees Pty Ltd v Rewards Projects Ltd (2011)WASC).
In the case of ABC Development Learning Centres Pty Ltd v Wallace(2006)VSC 171
The Supreme Court of Victoria struck down that the person who is senior in the company will be
The directing mind and will. Whose rights will be originates from the directors of the company
and such person will for the advantage of the organization and an employee can considered as
mind and will of the organization if worked within the authority( Supreme Court of Victoria
2006).

BUSINESS LAW ASSIGNMENT 2
Lifting Corporate veil
A corporation has its own legal existence all the directors and member the company will
not be responsible for any liabilities which more than his share in the company cannot be
entitled the liabilities of the company, not more than its stake But in chorus company is a juristic
person whose all the activities are performed by its member and directors. In the case related to
lifting the corporate veil, the court made decision in which the court held liable individually all
directors and member of the company for the action related to company hence judges did not
take account the distinguish existence of the institution and make the members responsible for
the such activity as these act performed by the members.
Further piercing is the process where the right and duty of company as member’s rights
and duty. Lifting is a lawful process to identifying the actual members
(Atlas Maritime Co SA v Avalon Maritime Ltd (No 1) (1991) 4 All ER 769)
Lifting the corporate veil introduced since the members of the company were accessing
corporate veil like a safeguard in order to protect themselves whereas piercing the corporate veil
identifies real authority, cheating, injustice, and calculate member’s accountability when the
liability arises. In the case the court decided the requirement of piercing of corporate veil for
limiting the instances of fraud to the other person where employee of the institution are
accessing limited liability section as a protection (Prest v Petroled Resources Ltd (2013) 2 AC
415).

BUSINESS LAW ASSIGNMENT 3
REFERENCES
Supreme Court of Victoria, 2006, ABC Development Learning Centres Pty Ltd v
Wallace(2006)VSC 171. Available from
http://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/vic/VSC/2006/171.html. [ 13 September
2017].
Atlas Maritime Co SA v Avalon Maritime Ltd (No 1) (1991) 4 All ER 769
Prest v Petrodel Resources Ltd (2013) 2 AC 415