Saturday, March 14, 2020

COMMERCIAL LAW Lifting the Veil of Incorporation essay

COMMERCIAL LAW Lifting the Veil of Incorporation essay COMMERCIAL LAW: Lifting the Veil of Incorporation essay COMMERCIAL LAW: Lifting the Veil of Incorporation essayLimited Liability Company is undoubtedly one of the most outstanding inventions of mankind. Along with technological advances, it provided an opportunity for rapid economic development of our civilization over the past century and a half. Such a company, first, is a subject to law separate from its members, and, second, the parties are not liable for its obligations. The latter makes it possible to attract funds of investors into various businesses, including high-risk ones, which creates favorable conditions for the realization of all kinds of innovative projects.Unfortunately, limited liability companies are often used in bad faith, in particular, as a tool to defraud creditors. This raises the question whether it is necessary to always adamantly follow the principle of limited liability, or sometimes this principle can be omitted placing the responsibility to the creditors on the participants of the company or other responsibl e persons. It is obvious that such exceptions are sometimes quite feasible and can be realized in the frameworks of piercing the veil of incorporation doctrine. At the same time, these conditions must be sufficiently restrictive so as not to discredit the very concept of limited liability. Further in this paper, we will explain the concept of lifting corporate veil by using real life examples and show the imperativeness of its importance.Lifting the veil: law practicePerhaps for the first time the issue of lifting the corporate veil was discussed at a high judicial level in a classic case of Salomon v A. Salomon Co Ltd of 1897. The majority shareholder owned 20001 shares of the company, while his wife and children owned six more (under the law of time the company should have had at least seven shareholders). Despite the fact that the majority shareholder completely controlled the shoe factory, which eventually went bankrupt, the House of Lords, acting as a court of highest resort, denied liquidator to entrust the shareholder liable for the debts of the company. The court in this case took quite a formalistic position, stating that all the requirements of the law regarding the establishment of a limited liability company had been met, and the court had no right to add any additional requirements to them (Presser, 2012, p.24). However, development of corporate forms in global business environment led the jurisprudence to the fact that in some cases the courts recognized the need to retreat from the principle of limited liability of shareholders (participants) of the company and the company’s management bodies, as well as the liability of parent companies for the actions of their subsidiaries.The essence of the doctrine of lifting the corporate veil is in assigning responsibility of an independent legal entity to third parties. In practice, this term is used in three cases (Presser, 2012; Franklin, 2013):When the court in dealing the issue of liability of the legal entity departs from the principle of the limited liability of the founders (participants) and places the responsibility on them;When the court ignores the separateness of legal entities belonging to a holding or a group of legal entities, and, based on the principle of â€Å"single economic unit†, imposes liability of an independent legal entity on separate legal entities comprising the holding or group;When the court imposes liability on the bodies of the legal entity.However, the most difficult issue in such cases is to determine the criteria by which the company will be subject to lifting the veil. In general, basing on Presser (2012), Franklin (2013), and Nyombi (2014), in the context of civil proceedings the courts have identified at least three situations where it is appropriate to lift the corporate veil. First, if the offender is trying to hide behind the corporate facade or veil to hide one’s crime and benefits from it. Second, if the offender commi ts an act on behalf of the company, which (with the mandatory presence of guilt) constitutes a criminal offense leading to one’s conviction; in this case the corporate veil is not even lifted but rather offhandedly torn off. Third, if the transaction or commercial structures are â€Å"device†, â€Å"cloak† or â€Å"sham†, that is, an attempt to disguise the true nature of the transaction or structure to defraud third parties or courts. Thus, we can conclude that the corporate veil lifting in civil disputes is based on the criteria of â€Å"ownership and control’ and â€Å"bad faith† subject to mandatory proof.The first element is denoted by the term â€Å"dominance† and the idea is that the controlling person has the ability to fully define actions of the controlled entity. To establish the fact of control, a number of factors can be used that considered together may indicate the presence of total control feature (situation where the company is the alter ego or instrumentality of its owner), as researched by Nyombi (2014), Franklin (2013) and OECD (2001):Insufficient independence, i.e. providing a minimum ownership capital insufficient for conducting activities;Milking the company use of company’s funds for personal needs of the owner (direct payment of personal telephone calls, personal vehicles, personal purchases, expenses of relatives, etc. from the corporate accounts);Misrepresentation – distortion of facts regarding business activities, information about location, company’s assets, managerial staff, providing false addresses, nominees as the administrative body of the company;Commingling and holding out the use of joint accounts, facilities, transport and other property;Non-compliance with corporate procedures/formalities: the absence or irregular conduct of meetings of participants, absence or merely a nominal presence of directors and other employees, inobservance of recordkeeping requirements, lack of bank account or conducting corporate transactions from the owner’s account, conducting business on behalf of the company and not on behalf of the owner, submitting no reports or irregular reporting documentation to the public and other authorities;Non-payment of dividends, non-distribution of profits;Using the company to pay the debts of other companies or those of the owner.The main criteria for the recognition of a company as the shareholder’s agent were established in 1939 in the case of Smith, Stone Knight Ltd v Birmingham Corporation (BC wanted to compulsorily acquire the land owned by SSK’s subsidiary Birmingham Waste Co Ltd, and parties disputed the compensation directly to Smith, Stone Knight Ltd, cited in Presser (2012, p.65), which included the following noticeable ones (Presser, 2012, p.69):Profit of the company is considered as the profit of the shareholder;Shareholder appoints the persons carrying out activities on behalf of the company;Shareholder is the brain center of the company;Shareholder has permanent control over the company’s business;Turning to more modern precedents, we should remember the case of DHN Food Distributors v Tower Hamlets London Borough Council of 1976, though it was not quite usual in the sense that the very controlling entity of the company demanded to lift the corporate veil (Presser, 2012, p. 93). Thus, the parent company wanted to take the place of the subsidiary it controlled. In this case, a plot of land in London formally owned by the company belonging to DHN-holding group that owned a grocery store was subject to the mandatory buyout for public use. DHN store warehouse was located on the buy-out land, and by the agreement with the affiliate DHN enjoyed the right perpetual lease of land. Its withdrawal led to the cessation of DHN business, and it could claim for damages if it owned the plot. DHN applied to the court for the corporate veil lifting, referring to the fact that it completely controlled its subsidiary. Namely, (1) it participated in the affiliate’s capital by 100%, (2) directors were the same people, and (3) the affiliate was used by the holding exceptionally to own the land and did not conduct any independent activity. The Court agreed with the arguments of the plaintiff and lifted the corporate veil, allowing DHN receive compensation for withdrawal of the land instead of the subsidiary.In all cases of principal-agent relationship between the company and its shareholder, the company actually lost its independence, which gave courts the grounds for departing from the principle of Solomon. At the same time, ownership and control are not sufficient criteria to lift the corporate veil. The court cannot lift the veil only because, in its opinion, it meets the interests of justice, but the corporate veil should be lifted if the case also involves impropriety, abuse of rights, deception or offense (Anderson, 2012, p. 133). As ex plained by OECD Taxation (2001, p.39), the essence of this criterion is that the controlled entity is used by the controlling person to the detriment of a third party and at the same time as the tool to escape from responsibility of the controlling person itself. In this situation, the case goes about using the corporate structure of the company as a facade to conceal the facts.For example, in Jones v Lipman (1962) (cited in Franklin, 2013, p.10), the defendant made a commitment by the contract to sell the land to the plaintiff, after which the one decided not to carry out the sale, set up a company being its shareholder and director, passed the land to its possession and refused to execute the contract with the plaintiff. Respondent filed suit for specific performance. The court obliged the director of the established company, and the company itself which was the creation of the controlling director, tool and veil, the mask which he held in front of his face to become invisible to the law of justice. Furthermore, in Adams v CapeIndustries (1990), it was found that there is no general principle according to which a group of companies should be regarded as one person (Anderson, 2012, p. 134). Thus, in Polly Peck International Plc (1996) it was found that a subsidiary being a financial mechanism created with the sole purpose of obtaining a loan should not have been considered part of the holding company (respectively, holding’s responsibility was not attached), even despite the fact that lenders issuing the loan, obviously, gave the money based on the trust to the latter (Presser, 2012, p.111). The precedent for further monitoring of offshore companies and for the recovery of lost revenue due to the activities of their owners was also created y the case of Antonio Gramsci v Stepanovs (2011) (Anderson, 2012, p. 135).Thus, in case of the presence of dominant control and impropriety related to the use of corporate structure to avoid or conceal liability, cor porate veil should be lifted in order to prevent corporate fraudulent activities and avoidance of executing contractual or other legal obligations. At the same time, shareholders may be accepted as personally liable if their illegal purposes or deliberate concealment of the true state of affairs is proved.ConclusionUnder current law, a legal entity is separate, individual and independent from its founders, having the ability to own property, to enter into commitments, and sue and be sued. An immanent feature of the legal entity’s independent nature is the limited liability of its founders: they are not liable for the obligations of the legal entity, that is, they are behind its veil. Development and complication of civil turnover led to the need to develop a list of exceptions to this principle, mainly to counteract the abuse of this right. â€Å"Lifting the veil† doctrine is included today in the corporate law of many countries aimed at providing diligent and proper e xercise of civil rights and civic duties.Piercing the corporate veil is an instrument for balancing the interests of the companies’ members (shareholders) and the interests of creditors, and is valid to uncover the ultimate beneficiary and fulfill the rights of creditors, if the entity is created only for the use of participants’ limited liability in terms of debts, which is particularly evident in activities of â€Å"one person† companies. In our opinion, despite the existing differences in interpretation, the institution should be used not to destruct the limited liability, but to prevent the unlimited one. In particular, it makes sense to consider the doctrine of lifting the corporate veil in the overall context of the fight against abuse of corporate relations, as well as a kind of addition to the norms of the written law, stipulating that under certain circumstances company participants can be deprived of their privilege of limited liability.

Wednesday, February 26, 2020

The Gambia Visit Essay Example | Topics and Well Written Essays - 750 words

The Gambia Visit - Essay Example He pointed out that the 1970 constitution divided the government into independent legislative. The constitution finds a safe bode in 1996, including a strong presidential government and protection of human rights. Regarding future political prospects, he was very optimistic. We got more than expected during this visit. Monday 2nd May: A lecture delivered by Dr. Emmanuel focused on Gambian law enhancement. He touched upon the sensitive issue of transatlantic diplomacy injuring the interests at home. Quoting a renowned work in this area, â€Å"states have traditionally from time to time reviewed the operation and effectiveness of their foreign ministries and diplomatic services. More often than not such inquiries have been occasioned by wide economic moves in the public sector or institutional rivalry.† His speech included issues harboring international peace and their implication, and foreign forces which are major players in devising the state’s internal policies. Recalling a piece of verbose from Dr. Emmanuel, â€Å"there is more to it than meets the eye†, brings to the forefront many of the devils at work. Nevertheless, the British ambassador in Tehran, Sir Anthony Parsons, does not support this. â€Å"The Embassy†, he notes â€Å"was primarily organized as an agency for the promotion of British exports and for the general commercial, financial and economic interests of the Britain†.... â€Å"The last incumbent also from Africa challenged the might of the empire, but Kofi Annan is known for his reconciliatory approach, than confrontatist posture. Like any other African congregation this one also brought out different diplomats in their colourful traditional attires. The accompanying music made every foot tap† (Gupta, 2005: page 123); A ground had been set for a positive and peaceful image of the country. â€Å"After 1871, political and cultural leaders recognized the instrumental and local music in cultural diplomacy† (Jessica C.E. Gienow-Hecht, 2009: page 36). This shows the impact art and craft has had on the nation’s subconscious mind of the diplomatic visage. This experience gave me some paradigms that had for quite some time remained at the back of my mind. Wednesday 4th May: The African Centre for Democracy and Human Right Studies was officially opened in 2001. During the visit, we were exposed to the eventful history gone through by the c enter. For the African Charter on Human and people’s rights to be effective, it was to be elaborated and comprehended by all Africa. This vision brought forth the formation of this center which was established to promote and insure respect of freedom, and to oversee that these freedoms do not go astray. â€Å"In order to find practicable solutions to institutional and existential problems caused by accelerating globalization diplomacy needs inter-disciplinary guidance by social sciences† (Bolewski, 2007: page 6). Adding to the already elaborated verbose in context of the need for social sciences to grow and take control of the growing diplomacy in trans-Atlantic relations, â€Å"Given that the issues cannot be ducked altogether, international human rights bodies have been reduced to

Monday, February 10, 2020

Legal Process Paper Essay Example | Topics and Well Written Essays - 750 words

Legal Process Paper - Essay Example In filing a charge, John must provide his name, address and telephone number as well as similar details about his employer. He must also include information about the number of employees at the organization, if he is aware of this. A brief description of the event that occurred on the basis of which he wishes to file his compliant, must be included and John must also describe when it happened and why and how he believes it violates his rights. However, John must take care to file his complaint within a period of 180 days after the discriminating incident occurred, and if this time period runs out, then his rights may no longer be protected. If the nature of John’s charge is such that it also falls within the purview of anti-discrimination, whether local or state based, then an extension would be allowed on the time period of filing to 300 days. Such state based organizations are referred to as Fair Employment Practices Agencies (FEPAs), and the work on a charge that is filed m ay be shared between the EEOC and the FEPAs, so that John’s interests would be protected under both federal and State laws. If John is filing a suit for discrimination on pay issues, then this would fall under the purview of the Equal pay Act, in which case there would be no time limits for filing and John would also be entitled to directly file his suit in a court of law. However, in cases of discrimination on other grounds, John must first allow his case to be processed by the EEOC, which will determine whether a violation has occurred. In the event there is a violation, efforts will be made by the EEOC to suggest measures for conciliation with the employer. If the resolution proposed by the EEOC is not satisfactory to John or if the EEOC is unsuccessful in getting an employer to comply and compensate John, then he will be notified of his right to file the suit in a court

Thursday, January 30, 2020

Things Fall Apart by Chinua Achebe Analysis Essay Example for Free

Things Fall Apart by Chinua Achebe Analysis Essay In the book, Things Fall Apart, written by Chinua Achebe, A man named Okwonko is desperate to avoid being what his father was like: lazy and undetermined. He is dominated by anger, fear, and impatience which get him in many situations. The tribe of Umoufia represents a civilization that is strictly based off male dominance. Men are only required to be strong, and have a title within the clan; while the women must cook, clean, and take care of the children, and are beat if they do not do so. Umoufia is a tribe that is based off of stereotypes and sexism. Women are looked down upon as objects instead of people. When they are old enough to get married, they do not get to choose, nor does the father choose. The women are bought and sold with sticks, like an animal and not a human being. This shows that the women are not appreciated, nor given any respect or dignity. They are treated more like slaves, and are not seen as important. When in reality, without women, the tribie of Umoufia would be nothing. A man gains respect and popularity in the tribe of Umoufia, is a strong, masculine man with a wife, a strong son, and a tough warrior. All men share the same goal, which is to become one of the lords of the clan. To do this, he is a warrior who is strong, brave, and fearless. Unofia, Okwonko’s father was lazy, poor, and a failure. He hated his father and wanted to be nothing like him. Okwonko has no desires for the pleasures in life, such as: dancing, music, and celebrations. Instead he hungers for power and wealth. This means he must run a strong family and house hold; with multiple wives, and many children. Another part of his masculinity is his duty of a solider. He wants to be physically strong in defending his village from incoming threats. Another way that Okwonko wants to show masculinity is through his children. He wants to pass down all he knows to his kids, and have them do the exact same. The boys shall have their own households and will be strong and proud. When the women shall be good wives, clean, cook, and give birth to many children. Okwonko only wants his kids to have the same traditions as he did, and for it to never change. Some elders believe that it is not right, and that it is right to have change. Okwonko wants his legacy to be kept alive by his children keeping on the same traditions. The women cook and clean, when the men own the household and are in charge. The women are given less credit then they deserve. Okwonko wants his wife to bare him a son, so that he can keep his family strong once he passes away. He depends on the wife to give him a son, and will beat her if she does not do so. When the child is born the wife must raise him and do all of the work. But the child is born to the husband and always owned by the man. Women are very important to the Umoufia tribe, but are treated inhumanly and not seen as a contributing factor of the tribes surviving and thriving. They are beaten regularly if they do not clean, cook, and take care of the house. They are sold as brides, and not given the right to do what they want.

Wednesday, January 22, 2020

Willy Lomans American Dream in Arthur Millers Death of a Salesman :: Death of a Salesman

Willy Loman's American Dream  in Arthur Miller's Death of a Salesman    Short Essay One   Ã‚  Ã‚   Arthur Miller’s Death of a Salesman focuses on the American Dream, or at least Willie Loman’s version of it. *Willie is a salesman who is down on his luck. He "bought into" the belief in the American Dream, and much of the hardship in his life was a result. *Many people believe in the American Dream and its role in shaping people’s success. Willy could have been successful, but something went wrong. He raised his sons to believe in the American Dream, and neither of them turned out to be successful either. By the time Willy got to be an old man, his life was in shambles. *One son, Biff, was a hopeless dreamer who wasn’t able to hold on to a job. He could have been successful through an athletic scholarship, but he blew the chance he had to go to school. Happy, the other son, had a job, but was basically all talk, just like Willy. Now near the end of his career as a salesman, Willy realizes his whole life was just a joke, and the hopes he placed in the American Dream were misguided. At the end of the play, his only hope is to leave something for his family, especially for Biff, by taking his own life and leaving his family the insurance money. Through his death, Willy thinks he can achieve success and fulfill his dream. Arthur Miller provides us with a character who is both pathetic and tragic. Willy Loman spent his life chasing a false dream. His failure to live the "true" American Dream was what brought about his own downfall.** Short Essay Two In Miller’s Death of a Salesman, Willy Loman’s warped view of the American Dream caused tragedy in his family because he stressed the importance of popularity over hard work and risk-taking over perserverence. *Willy grew up believing that being "well-liked" was important to becoming a success. He believed that being well-liked could help you charm teachers and open doors in business. *He is proud that the neighborhood boys flock around Biff and respond to Biff’s athletic abilities, and in the same breath scoffs at the nerdy Bernard, who is too focused on school and his studies to be popular. Even though Biff turns out to be a failure as an adult, Willy holds on to the hopes that a business man who Biff met years ago will offer him a terrific job if Biff can be his old likeable self and recapture the confidence and grace he had as a teenager.

Tuesday, January 14, 2020

The Caliper and Micrometer

The Vernier Caliper and Micrometer Experiment # 1Abstract:The activity involved the use of both vernier and micrometer calipers accurately on measuring provided materials. The objectives of the act were to familiarize the students with the use of the said scales and to demonstrate their differences. The dimensions of a metallic cube made of steel and a metallic washer were measured using a vernier caliper while that of a marble made of glass and the same metal cube were measured using the micrometer caliper. The density and percentage error of each material were then computed using the values obtained. Guide Questions:1.) Differentiate the vernier and micrometer scales?The Vernier caliper is an extremely precise measuring instrument; its accuracy is 0.05mm. It can show measurements up to two decimal places in millimeters. It has main scale, which shows whole numbers and the vernier scale which gives decimal values. The vernier is capable of measuring the outer and inner dimensions in cluding the depth. A micrometer caliper uses a calibrated screw for measurement, rather than a slide which the vernier caliper uses. . It can show measurements up to three decimal places in millimeters. It also has a main scale like the vernier caliper with the same purpose with the micrometer scale showing decimal values. Its accuracy is equal to 0.01 mm making it more accurate than the vernier caliper. The micrometer can only measure the outer dimensions of an object.2.) Draw the figure for micrometer readings below:i. 3.685 mmii. 1.5963.) State some of the errors the one might make in measuring length using both vernier and micrometer calipers.The errors that one may make in measuring length using both the vernier and micrometer calipers are the incorrect reading of measurements. There can also be human misinterpretation, meaning that the person may have set the instrument too tight which may deform the object or too lose which leaves extra space for error. The device can also be broken promoting errors.4.) Determine the percentage error for an observed value of 1.112Ãâ€"10-5 if the standard value is 1.117Ãâ€"10-5?%error = actual value-observed value x100 actual value%error= 1.117Ãâ€"10-5-1.112Ãâ€"10-5 x100 1.117Ãâ€"10-5 %error= 5.000Ãâ€"10-8 x100 1.117Ãâ€"10-5 %error= 4.476Ãâ€"10-3 x 100 %error= .4476%

Monday, January 6, 2020

Defense of Hard Determinism - 1100 Words

A. DEFENCE OF HARD DETERMINISM Hard Determinism argues that every event is causally determined. For an event ‘A’ to occur casually means that there are antecedent causes that ensure the occurrence of ‘A’ in accordance with impersonal, mechanical causal laws. To clarify hard determinism further, let me present hard determinism as an argument. Basically hard determinism argues that: (a) Determinism is true (b) Determinism is incompatible with free will (Holbach, 451). In defense of premise (a), the hard determinist says that obviously everything is caused, therefore determinism is true. To prove that determinism is false, the opponent would have to come up with an example of an uncaused event. To defend premise (b), the hard determinist†¦show more content†¦In the instance, the man kills himself due to reasons whose immediate impulses are internal but those impulses were formed due to some external causes. One such external cause might be that his daughter was kidnapped and the kid napper called and said that if the man did not shoot himself by sun down today, then his daughter will be killed. But if the man kills himself by sun down, then his daughter will be safely returned to her mother. So in this case the man kills himself due to an internal impulse which is generated by an external cause. And in the instance where someone comes and shoots him, the cause is external as well. So in neither of these cases man is free. In the first instance when the man kills himself, he is bound by his love for his daughter and therefore does not really have a choice and in the second instance, he does not have any choice either. The conclusion is that choice does not really exist and even if it existed, it would not mean existence of free will. And complexity of the brain’s thought process when reconsidering a first impulse should not be confused with free will either. Another responsibility for me is to show why free will is fundamentally incompatible with determinism. Soft determinists, such as Stace, will say that free will and determinism is perfectly compatible with each other. But incompatibilists will disagree. Incompatibilist believes that free will means that man must be the ultimate orShow MoreRelatedDo We Have a Free Will? Essay example1462 Words   |  6 Pagespossibly shape the future of an individual through is actions. On the functional view, it is notable that even when individuals make decisions rooted on their mental states, it is possible that those states ought to have causative agents. To establish determinism, we can admit by denoting that some events in our lives happen because of prior reasons without yet losing our sense of freedom. 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In addition, sexual impulses play a large role in the psychodynamic theory. According to FreudRead MoreHow Causation Is A Relation Between Events Or States Of Affairs Essay2491 Words   |  10 Pagesan event or state of affairs. An example of Immanent causation is me recycling the paper because I’m the â€Å"agent† who recycled the piece of paper, it wasn’t done by another event. During the paper, Chisholm reflects on two objections and takes his defense on both. The first one being simply a fact of (a) He could have done otherwise means no more nor less than and (b) If he could have chosen to do otherwise, he would have done otherwise. The second objective has a broader meaning which can be summarized