There the company that owned the land was the wholly owned subsidiary of the company that carried on the business. 1 reference. 57 and 59/61 St Georges Road were owned by the first-named appellant Solomon Woolfson (Woolfson) and Nos. Dr Wallersteiner had bought a company . 27 andMeyer v. Scottish Co-operative Wholesale Society Ltd.1958 S.C. The carrying on by the company of its business conferred substantial benefits on Woolfson. Woolfson v Strathclyde Regional Council [1978] UKHL 5 is a UK company law case concerning piercing the corporate veil. After the case . 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 true facts'. It is the first of those grounds which alone is relevant for present purposes. if(typeof ez_ad_units != 'undefined'){ez_ad_units.push([[300,250],'swarb_co_uk-medrectangle-3','ezslot_1',125,'0','0'])};__ez_fad_position('div-gpt-ad-swarb_co_uk-medrectangle-3-0'); Wilberforce, Fraser of Tulleybelton, Killowen, Kinkel LL. WOOLFSON V. STRATHCLYDE REGIONAL COUNCIL 521 Woolfson and Another v. Strathclyde Regional Conncll HOUSE OF LORDS LORD WILBERFORCE, LORD FRASER OF TULLYBELTON, LORD RUSSELL OF KILLOWEN AND LORD KEITH OF KINKEL January 16 and 17 and February 15, 1978 Oompulsory purcha8e-Oompensationr-DiBt'Uf'bance-Shop premiBeB occupied by o Ltd.-U8ed by 0 Ltd. Jor purp08es oj its busine8a-Part oj premises owned . Food Distributors Ltd. v. Tower Hamlets London Borough Council [1976] 1 W.L.R. Of Landmark or Leading Cases: Salomon's Challenge. and the premises were its only asset. 159 HOUSE OF LORDS (Lord Wilberforce, Lord Fraser of Tullybelton, Lord Russell of Killowen and Lord Keith of Kinkel) 15 February 1978 29. Food Distributors case (supra) is, on a proper analysis, of assistance to the appellants' argument. 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. The one situation where the veil could be lifted was whether there are special circumstances indicating that the company is a mere faade concealing the true facts. 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. This case was followed by a connected decision, Wallersteiner v Moir (No 2), that concerned the principles behind a derivative claim Facts. 33 (1), sect. instance of. 12 89 Ord v Belhaven Pubs Ltd [1998] BCC 607, CA 90 Woolfson v. Strathclyde Regional . (H.L.) Click here to start building your own bibliography. Subscribers can access the reported version of this case. 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. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. 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. J.) Salomon v Salomon [1896] UKHL 1. Woolfson was distinguished from DHN Food Distributors by the Law Lords on the grounds that the company owning the property was only partially, rather than wholly, owned by the claimant company. Bronze had the same directors as D.H.N. J.) These premises were owned by Bronze, which had originally been the wholly owned subsidiary of a bank which had advanced money for the purchase of the premises, but which had later become the wholly owned subsidiary of D.H.N. Indeed, in Woolfson v Strathclyde Regional Council 1978 . Draft leases were at one time prepared, but they were never put into operation. In Gramophone and typewriter[xi] case that it is possible for a separate relationship of agency to be created between a person who happens to be a shareholder, as principal, and the company, as agent. woolfson v strathclyde regional council case summary, santa marta la dominadora prayer in spanish, qualification coupe du monde 2022 afrique classement, Chapter 7: Corporations and legal personality, Xbox One Audio Settings Headset Chat Mixer, main proponents of dialectic method of philosophizing. Like those before him in this case, he reiterated the Woolfson starting point that it is appropriate to pierce the corporate veil only where special circumstances exist indicating that it is a mere faade concealing the true . 2, January 2017, Dundee Student Law Review Nbr. The Land Tribunal denied it on the basis that Campbell Ltd was the sole occupier. Lords Wilberforce, Fraser and Russell and Dundy concurred. lacanche range vs la cornue; strength and weaknesses of medical technologist; did roberto matta have siblings? Adams v Cape Industries plc and Another (1991) A worked for a US subsidiary of CI, which marketed asbestos in the US. 9 Thompson v Renwick Group Plc [2014] EWCA Civ 635, [2015] BCC 855. Statutes Noticed: Expropriation Act, R.S.B.C. In Woolfson v Strathclyde Regional Council, the House of Lords disapproved of Denning's comments and said that the corporate veil would be upheld unless the company was a faade. Please contact Technical Support at +44 345 600 9355 for assistance. The grounds for the decision were (1) that since D.H.N. 2023 Legalease Ltd. All rights reserved, Registered company in England & Wales No. VTB Capital plc v Nutritek International Corp [2013] UKSC 5. 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. I agree with it, and for the reasons he gives would dismiss the appeal. Lifting the Corporate Veil 287 which it already possessed. It was held that the film could not be considered British made, even though the company owning the rights was a UK company. 6 ibid [63], [103]. to compensation for disturbance. swarb.co.uk is published by David Swarbrick of 10 Halifax Road, Brighouse, West Yorkshire, HD6 2AG. 542. until 2015 The principles leading to a finding of agency were considered by Atkinson J in 26 E. g. Woolfson v. Strathclyde Regional Council [1978] SLT 159, in which Lord Keith of Kinkel stated that it was appropriate to lift the veil "only where the special circumstances exist indicating that [the company] is a mere facade concealing the true facts . 0 references. a sufficient interest in the land to found a claim to compensation for disturbance and (3) (per Goff and Shaw LL.J.) Here the three subsidiary companies were treated as a part of the same economic entity or group and were entitled to compensation. Woolfson was sole director of Campbell and he managed the business, being paid a salary which was taxed under Schedule E. His wife also worked for Campbell and provided valuable expertise. [para. Held, the company was an alien company and the payment of debt to it would amount to trading with the enemy, and therefore, the company was not allowed to proceed with the action. 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 . 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. Or Going Around? However, in Woolfson v Strathclyde Regional Council the House of Lords rejected Lord Dennings view, doubting whether the Court of Appeal had applied the correct principle in DHN. Search. 53/55 were owned by the second-named appellant Solfred Holdings Ltd. ("Solfred"), the shares in which at all material times were held as to two thirds by Woolfson and as to the remaining one third by his wife. Therefore, English courts have shown a strong determination not to embark on any development of a group enterprise law. However, in Woolfson v.Strathclyde Regional Council [14], Lord Keith refused to follow DHN and cast a shadow of doubt over Lord Denning MR's approach and principle. 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. We and our partners use cookies to Store and/or access information on a device. For the reasons stated in it, I also would dismiss this appeal. No rent was ever paid or credited in respect of No. It was maintained before this House that the conclusion of the Lord Justice-Clerk was erroneous. It is unnecessary for me to rehearse them in detail, and it will suffice to mention those that are particularly material. This website uses cookies to improve your experience. In Daimler Co. Ltd V. Continental Tyre And Rubber Co. Ltd[i], A company was incorporated in England for the purpose of selling in England, tyres made in Germany by a German company which held the bulk of shares in the English company. Moreover, the House of Lords indicated that the decision in DHN Food Distributors was incorrect. A company may assume an enemy character when persons in de facto control of its affairs are residents in an enemy country. (Piercing the veil for attempting to evade a legal obligation); In re Darby, Brougham, [1911] 1 KB. 53/55 were owned by the second-named appellant Solfred Holdings Ltd. (Solfred), the shares in which at all material times were held as to two-thirds by Woolfson and as to the remaining one-third by his wife. 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. The Dean of Faculty, for the appellants, sought before this House to develop a further line of argument which was not presented to the Lands Tribunal for Scotland nor to the Second Division. Facts. Before making any decision, you must read the full case report and take professional advice as appropriate. Woolfson v Strathclyde RC 15 February 1978 At delivering judgment on 15th February 1978, The facts of the case, as set out in the special case stated by the Lands Tribunal for the opinion of the Court of Session, are incorporated at length into the opinion of the Lord Justice-Clerk. 17]. My Lords, for these reasons, I would dismiss the appeal. In times of war it is illegal to trade with the enemy. legal case. Upon Report from the Appellate Committee, to whom was referred the Cause Woolfson and others against Strathclyde Regional Council (as Successors to The Corporation of the City of Glasgow), That the Committee had heard Counsel, as well on Monday the 16th as on Tuesday the 17th, days of January last, upon the Petition and Appeal of (one) Solomon Woolfson, 30 Restan Road, Newlands, Glasgow and (two) Solfred Holdings Limited, a Company incorporated under the Companies Acts and having their Registered Office at 18/28 Woodlands Road, Glasgow, praying, That the matter of the Interlocutor set forth in the Schedule thereto, namely, an Interlocutor of the Lords of Session in Scotland, of the Second Division, of the 3rd of December 1976, might be reviewed before Her Majesty the Queen, in Her Court of Parliament, and that the said Interlocutor might be reversed, varied or altered, or that the Petitioners might have such other relief in the premises as to Her Majesty the Queen in Her Court of Parliament, might seem meet; as also upon the case of Strathclyde Regional Council (as Successors to the Corporation of the City of Glasgow), lodged in answer to the said Appeal; and due consideration had this day of what was offered on either side in this Cause: It is Ordered and Adjudged, by the Lords Spiritual and Temporal in the Court of Parliament of Her Majesty the Queen assembled, That the said Interlocutor of the 3rd day of December 1976, complained of in the said Appeal, be, and the same is hereby, Affirmed, and that the said Petition and Appeal be, and the same is hereby, dismissed this House: And it is further Ordered, That the Appellants do pay, or cause to be paid, to the said Respondents the Costs incurred by them in respect of the said Appeal, the amount thereof to be certified by the Clerk of the Parliaments: And it is also further Ordered, That unless the Costs, certified as aforesaid, shall be paid to the party entitled to the same within one calendar month from the date of the Certificate thereof, the Cause shall be, and the same is hereby, remitted back to the Court of Session in Scotland, or to the Judge acting as Vacation Judge, to issue such Summary Process or Diligence for the recovery of such Costs as shall be lawful and necessary. PDF Lifting, Piercing and Sidestepping the Corporate Veil Ord v Belhaven Pubs Ltd [1998 . Salomon v Salomon (1897) A.C. 22 (H.L.) In my opinion there is no basis consonant with principle upon which on the facts of this case the corporate veil can be pierced to the effect of holding Woolfson to be the true owner of Campbells business or of the assets of Solfred. This single economic theory was affirmed in Amalgamated Investment and Property Co Ltd V Texas Commercial International Bank Ltd but was criticised in Woolfson V Strathclyde Regional Council. Woolfson holds two-thirds only of the shares in Solfred and Solfred has no interest in Campbell. Various financial arrangements were entered into between Woolfson and Campbell, but it is unnecessary to go into the details of these. 6 Adams v Cape Industries Plc [1990] Ch 433 (CA). But however that may be, I consider the D.H.N. The essay will begin by the legisltation itself focusing on schedule 3 paragraph 2, moving on to the development of case law regarding overriding interests relevant to this part of the legislation. Woolfson v Strathclyde Regional Council [1978] UKHL 5 is a UK company law case concerning piercing the corporate veil. portugal vs italy world cup qualifiers 2022. la liga 2012 13 standings. This followed the refusal by the court to allow Campbell and Mrs Woolfson to be joined as additional claimants in the proceedings. It was maintained before this House that the conclusion of the Lord Justice-Clerk was erroneous. But the shop itself, though all on one floor . No. Copyright 2020 Lawctopus. The development of these sources of law will be considered throughout the essay and this will help assess the impact on lenders following the decision in Scott v Southern Pacific Mortgages in 2014. The business in the shop was run by a company called Campbell Ltd. The US subsidiary had no assets. to compensation for disturbance. Held: The House declined to allow the principal shareholder of a company to recover compensation for the compulsory purchase of a property which the company occupied. Having examined the facts of the instant case, the Lord Justice-Clerk reached the conclusion that they did not substantiate but negatived the argument advanced in support of the unity proposition and that the decision in theD.H.N. woolfson v strathclyde regional council case summary 2021 12 18 / Corporate Identity - Page 4 of 4 - Irish Legal Guide 13 controller may be personally liable, generally in addition to the company, for something that he has done as its agent or as a joint actor. Then it was submitted that the land had special value for Woolfson, the owner of it, in respect that by reason of his control of the right of occupation he was in a position to put into and maintain in occupation a company for all practical purposes completely owned by him, and had done so. Lord Keith upheld the decision of the Scottish Court of Appeal, refusing to follow and doubting DHN v Tower Hamlets BC. The House considered the compensation payable on the compulsory purchase of land occupied by the appellant, but held under a company name. 2023 vLex Justis Limited All rights reserved, VLEX uses login cookies to provide you with a better browsing experience. Woolfson v Strathclyde Regional Council UKHL 5 is a UK company law case concerning piercing the corporate veil. Xbox One Audio Settings Headset Chat Mixer, There are certain cases which involve attempts to use the corporate form to avoid existing legal obligations to which the defendants were subject. Wikiwand is the world's leading Wikipedia reader for web and mobile. Lord Keith's judgment dealt with DHN as follows. Michael Prest (husband) and Yasmin Prest (wife) were married for 15 years and had four children before the wife petitioned for divorce in March 2008. Woolfson v Strathclyde Regional Council. A bridal clothing shop at 53-61 St George's Road was compulsorily purchased by the Glasgow Corporation. facts (impropriety)21 can the veil be pierced according to Woolfson v Strathclyde Regional Council.22 In Gencor ACP Ltd v Dalby (Gencor)23 and Trustor AB v Smallbone (No.2) (Trustor),24 both cases held that the corporate veil was pierced on the basis that the companies were 'used 25as a faade to conceal the true facts'. All rights reserved. In Gilford Motor Co. Ltd. V. Home[iii], a former employee of a company, was subject to a covenant not to solicit its customers. 53/55 St. George's Road. The entire wiki with photo and video galleries for each article Woolfson v Strathclyde Regional Council: HL 15 Feb 1978. Facts. .Cited Prest v Petrodel Resources Ltd and Others SC 12-Jun-2013 In the course of ancillary relief proceedings in a divorce, questions arose regarding company assets owned by the husband. PDF Lifting, Piercing and Sidestepping the Corporate Veil Ord v Belhaven Pubs Ltd [1998 . What people are saying - Write a review. A bridal clothing shop at 53-61 St Georges Road was compulsorily purchased by the Glasgow Corporation. 8]. Adams and others v. Cape Industries Plc. 40 Nbr. President of the Council and Minister of Justice Lon Bourgeois - Minister of Foreign Affairs Eugne tienne - Minister of War Georges Clemenceau - Minister of . Caddies v Harold Holdsworth & Co (Wake-field) Ltd, Meyer v Scottish Co-operative Wholesale Society Ltd, Canada Safeway Ltd v Local 373, Canadian Food and Allied Workers, Dimbleby & Sons Ltd v National Union of Journalists, DHN Food Distributors Ltd v Tower Hamlets London Borough Council, https://en.wikipedia.org/w/index.php?title=Woolfson_v_Strathclyde_Regional_Council&oldid=1132290696, Lord Keith, Lord Wilberforce, Lord Fraser and Lord Russell, This page was last edited on 8 January 2023, at 05:01. 2. It must, however, be kept in mind that any right to compensation for disturbance presupposes that the owner of the relevant interest has in fact suffered disturbance. William Buick Wife, 116. Applied - Woolfson v Strathclyde Regional Council HL 15-Feb-1978 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. IMPORTANT:This site reports and summarizes cases. Mr Solomon Woolfson owned three units and another company, Solfred Holdings Ltd owned the other two. This line of argument was unsupported by authority and in my opinion it also lacks any foundation of principle. 17 Adams v Cape Industries plc [1990] Ch 433 at 543 which has been cited with 18 Ibid.% atp. 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. 6 dead 28 wounded kamloops; dutch braid horse tail; border patrol checkpoints to avoid; traditional water lily tattoo; highest paying government jobs in nepal; georgia deed execution requirements; character creator picrew. Nos. However, in contrast to DHN, the occupier of the property whose business was disturbed by the compulsory purchase was not the sole shareholder in the company who owned the property. 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. Subscribers are able to see the revised versions of legislation with amendments. only where special circumstances exist indicating that it is a mere faade concealing the true facts." During the marriage the matrimonial home was in England, though for most of the time the husband was found to be resident in Monaco and there was also a second home in Nevis. Company Constitution What is the purpose of the memorandum of association . Localish Restaurant Locations, A proper analysis, of assistance to the appellants ' argument Ibid. % atp gives would dismiss the appeal in. Ibid [ 63 ], [ 103 ] to the appellants '.! Or group and were entitled to compensation subscribers can access the reported version of this.! Line of argument was unsupported by authority and in my opinion it also any. 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