Woolfson v Strathclyde Regional Council . legal case. 33 (4) [para. Woolfson v Strathclyde RC [1978] UKHL 5 (15 February 1978) admin March 8, 2020 INTERNATIONAL / U.K. House of Lords At delivering judgment on 15th February 1978, LORD WILBERFORCE .My Lords, I have had the advantage of reading in draft the speech to be delivered by my noble and learned friend Lord Keith of Kinkel. The appellants argument before the Lands Tribunal proceeded on the lines that the business carried on in the premises was truly that of the appellants, which Campbell conducted as their agents, so that the appellants were the true occupiers of the premises and entitled as such to compensation for disturbance. Prest v Petrodel Resources Ltd and Others, [2013] UKSC 34. 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. Their scientific name, Phascolarctos cinereus, is derived from several Greek words meaning pouch bear (phaskolos arktos) and having an ashen appearance (cinereus). Woolfson v Strathclyde Regional Council [1978] UKHL 5 is a UK company law case concerning piercing the corporate veil. In the case of Woolfson v Strathclyde Regional Council[vi], it involves a similar fact pattern to DHN involving a compulsory purchase of property where the occupier of the property was not the owner. William Buick Wife, Counsel: James R. Kitsul, for the appellant; Sarah Macdonald, for the respondent. 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. Lords Wilberforce, Fraser and Russell and Dundy concurred. To browse Academia.edu and the wider internet faster and more securely, please take a few seconds toupgrade your browser. Woolfson v Strathclyde Regional Council [1978] UKHL 5 is a UK company law case concerning piercing the corporate veil. I have some doubts whether in this respect the Court of Appeal properly applied the principle that it is appropriate to pierce the corporate veil only where special circumstances exist indicating that is a mere faade concealing the true facts. A bridal clothing shop at 53-61 St George's Road was compulsorily purchased by the Glasgow Corporation. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. Woolfson holds two-thirds only of the shares in Solfred and Solfred has no interest in Campbell. Request a trial to view additional results, Petrodel Resources Ltd and Others v Prest, The Shipping Corporation of India Ltd v Evdomon Corporation and Another, The Esteem Settlement (Abacus (CI) Ltd as Trustee. Woolfson holds two-thirds only of the shares in Solfred and Solfred has no interest in Campbell. 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. The argument is in my opinion unsound, and must be rejected. Jones v Lipman, Gilford Motor Co Ltd v Horne, Woolfson v Strathclyde Regional Council, New Zealand Seamen's Union IUOW v Shipping Corporation Ltd, Official Assignee v 15 Insoll Avenue Ltd in favour of lifting the corporate veil. 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. 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. An example of data being processed may be a unique identifier stored in a cookie. 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. Horne. I agree with it, and for the reasons he gives would dismiss the appeal. Subscribers are able to see a list of all the documents that have cited the case. 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. Only full case reports are accepted in court. In Re Darby, ex Broughham which dates back to 1911, the veil was lifted where career-fraudsters had incorporated companies to disguise their true involvement . 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. The issued share capital of Campbell was 1,000 shares, of which 999 were held by Woolfson and one by his wife. This started from the proposition that compensation for disturbance is not in a special category but simply constitutes one aspect of the value of land to the persons whose interest in it is being compulsorily acquired. Here the three subsidiary companies were treated as a part of the same economic entity or group and were entitled to compensation. Salomon v Salomon (1897) A.C. 22 (H.L.) . The case was heavily doubted by the Court of Appeal in Ord v Belhaven Pubs Ltd. . wgci past radio personalities; auto sear jig legal 53-61 St George's Road Glasgow Corporation . Usually, a corporation is treated as a separate legal person, which is solely responsible for the debts it incurs and the sole beneficiary of the credit it is owed. A bridal clothing shop at 53-61 St George's Road was compulsorily purchased by the Glasgow Corporation. How does the decision in DHN Food Distributors Ltd v Tower Hamlets LBC [1976] 1 WLR 852 compare with the decision in Woolfson v Strathclyde Regional Council 1978 SLT 159? Corporate structures, the veil and the role of the courts. Food Distributors Ltd. v. Tower Hamlets London Borough Council[1976] 1 W.L.R. 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. 22Woolfson v Strathclyde Regional Council. Woolfson v Strathclyde Regional Council (1979) 38 P & CR 521 Wrexham Maelor Borough Council v MacDougall [1993] 2 EGLR 23 Wrotham Park Settled Estates v Hertsmere Borough Council [1993] 2 EGLR 15 Page No(s) 106, 205 69, 172 195, 201 44 116, 208 42 83 115 55 119 50 114 214 126 20 81, 209 21, 68, 73, 75, 82, 84, 97, 185, 187, 201, 212 66 163 8 . The business in the shop was run by a company called Campbell Ltd. 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. Cape Industries plc., and on an observation by Lord Keith in the House of Lords decision in Woolfson v. Strathclyde Regional Council that "it is appropriate to pierce the corporate veil only where special circumstances exist indicating that it is a mere faade concealing the true facts." A significant fallout of the decision in Hashem v. From 1962 till 1968 Campbell paid rent to Solfred in respect of Nos. 39 Referring to the opinion of Lord Keith in Woolfson v. Strathclyde Regional Council (6), they pointed out that that exception is ([1978] SLT at 161) ". He approached the matter from the point of view of the principles upon which a court may be entitled to ignore the separate legal status of a limited company and its incorporators, which as held inSalomon v. Salomon &Co. Ltd.[1897] AC 22must normally receive full effect in relations between the company and persons dealing with it. 90 (15 February 1978) Links to this case Content referring to this case We are experiencing technical difficulties. Woolfson v Strathclide UKHL 5 . . In a leading case of Adams V Cape Industries Plc [4] the courts refused to apply the single economic unit principle and noted that subsidiaries are not . Woolfson v Strathclyde RC [1978] UKHL 5 (15 February 1978), William Trotter and Others v Young Trotter, Epping Forest District Council v Philcox [2000] EWCA Civ 515 (08 December 2000), The Magistrates of Glasgow, and Others, V James Paton, and Others. Further, the decisions of this House inCaddies v. Harold Holdsworth &Co. (Wake-field) Ltd.1955 S.C. It is unnecessary for me to rehearse them in detail, and it will suffice to mention those that are particularly material. LORD FRASER OF TULLYBELTON.My Lords I have had the advantage of reading in print the speech of my noble and learned friend Lord Keith of Kinkel, and I agree with it. 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. imported from Wikimedia project. Subscribers can access the reported version of this case. Woolfson v. Strathclyde Regional Council (1978) SC 90 . 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. [iv] Jones v. Lipman and Another (1962) 1 WLR 832 L. [v] D.H.N.food products Ltd. V. Tower Hamlets, LBC [1976] 1 WLR 852, [vi] Woolfson v Strathclyde Regional Council, [1978] SC (HL) 90, [vii] Adam v Cape Industries Plc, [1990] Ch 433, [viii] Woolfson v Strathclyde Regional Council, [1978] SC (HL) 90, [ix] Ord & Another v Belhaven Pubs Ltd, [1998] 2 BCLC 447, [x] Prest v Petrodel Resources Ltd and Others, [2013] UKSC 34, [xi]Gramophone and typewriter, Ltd v Stanley, [1908] 2 KB 89, Give it a try, you can unsubscribe anytime :), Get to know us better! 12 89 Ord v Belhaven Pubs Ltd [1998] BCC 607, CA 90 Woolfson v. Strathclyde Regional . We and our partners use cookies to Store and/or access information on a device. From 1962 till 1968 Campbell paid rent to Solfred in respect of Nos. Updated: 07 December 2022; Ref: scu.279742. Here, on the other hand, the company that carried on the business, Campbell, has no sort of control whatever over the owners of the land, Solfred and Woolfson. 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. 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. 27 and Meyer v Scottish Co-operative Wholesale Society Ltd 1958 S.C. In my opinion the conclusion was correct, and I regard as unimpeachable the process of reasoning by which it was reached. A bit of reading never hurts. I agree with it and with his conclusion that this appeal be dismissed. The whole of the shop premises was occupied by a company called M. & L. Campbell (Glasgow) Limited ("Campbell") and used by it for the purpose of its business as costumiers specialising in wedding garments. 2023 vLex Justis Limited All rights reserved, VLEX uses login cookies to provide you with a better browsing experience. and dogs Im a perfectionist too, Lord Keith, Lord Wilberforce, Lord Fraser and Lord Russell, DHN Food Distributors Ltd v Tower Hamlets LBC, Ord v Belhaven Pubs Ltd, Jones v Lipman, Woolfson v Strathclyde Regional Council Wikipedia, DHN Food Distributors Ltd v Tower Hamlets LBC, Case Law Company single economic entity Woolfson v Strathclyde Regional Council 1978. 17]. It is the first of those grounds which alone is relevant for present purposes. 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.[1]. woolfson v strathclyde regional council case summary About; Sponsors; Contacts I was referred to Gilford Motor Co. Ltd v Horne [1933] Ch.935, Jones v Lipman [1962] 1 WLR 832, Woolfson v Strathclyde Regional Council [1978] SLT 159, Re a Company [1985] BCLC 333, Adams v Cape Industries plc [1990] 1 Ch. J.) The House considered the compensation payable on the compulsory purchase of land occupied by the appellant, but held under a company name. In this case, the owner of the property was also the majority shareholder in the occupier and it was held that the facts of this case do not fall within the faade exception; but it provides no guidance which needs to determine. Or Going Around? Lord Keith's judgment dealt with DHN as follows. Find something interesting to watch in seconds. 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. Therefore, English courts have shown a strong determination not to embark on any development of a group enterprise law. The compulsory acquisition resulted in the extinction of the grocery business, since no suitable alternative premises could be found. In the case of D.H.N. 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. was in a position to control its subsidiaries in every respect, it was proper to pierce the corporate veil and treat the group as a single economic entity for the purpose of awarding compensation for disturbance; (2) that if the companies were to be treated as separate entities, there was by necessary implication from the circumstances an agreement between D.H.N. The courts have typically been averse to allow a shareholder to drop the corporate veil and obtain a benefit on the basis that he and the company are in effect the same (Woolfson v Strathclyde Regional Council [1978] UKHL 5; Tunstall v Steigmann [1962] 2 QB 593; Macaura v Northern Assurance Co Ltd [1925] AC 619 (HL); Thomas K Cheng, "The . Copyright 2020 Lawctopus. I agree with it, and for the reasons he gives would dismiss the appeal. What people are saying - Write a review. However, the House of Lords ruled that Woolfson and its subsidiary were not a single economic unit due to operational practices. I have had the advantage of reading in draft the speech to be delivered by my noble and learned friend Lord Keith of Kinkel. From 1952 until 1963, when Schedule A taxation was abolished, payments by way of rent for Nos. In Adam v Cape Industries Plc[vii], the single economic unit argument, there is no general principle that all companies in a group of companies are to be regarded as one. Academia.edu no longer supports Internet Explorer. This is same as the case of Woolfson v Strathclyde Regional Council (1978). All rights reserved. case company bank reconciliation; primary care doctor port jefferson, ny. There the company that owned the land was the wholly owned subsidiary of the company that carried on the business. 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. It was held by the Court of Appeal (Lord Denning M.R., Goff and Shaw LL. Mr Solomon Woolfson owned three units and another company, Solfred Holdings Ltd owned the other two. Lord Keith observed that it is appropriate to pierce the corporate veil only where special circumstances exist indicating that it is a mere facade concealing the true facts. Where the evidence shows that a company has been used as a vehicle or device for receiving monies wrongly paid out of a claimant company in breach of a defendants duty to that company, the receipt by the third party vehicle will be treated as the receipt by the defendant. But opting out of some of these cookies may have an effect on your browsing experience. But however that may be, I consider the D.H.N. Draft leases were at one time prepared, but they were never put into operation. The business in the shop was run by a company called Campbell Ltd. (49) Woolfson v. Strathclyde Regional Council, Limited [1897] AC 22, Lord Sumption analysed attempts to pierce the corporate veil, referencing Woolfson v Strathclyde Regional Council, AC 22 Adams v Cape Industries Plc [1990] Ch. to compensation for disturbance. Facts. C Minor Autotune, The DHN case approach has become less popular since then. Impact of overriding interests under Land Registration Act 2002, THE MODER LAW OF MORTGAGES I TAZAIA THE ROLE OF THE LAD ACT, 1999. No rent was ever paid or credited in respect of No. Woolfson v Strathclyde Regional Council [1978] UKHL 5 is a UK company law case concerning piercing the corporate veil. The . The entire wiki with photo and video galleries for each article The relevant parts of the judgments in D.H.N. technology developed exclusively by vLex editorially enriches legal information to make it accessible, with instant translation into 14 languages for enhanced discoverability and comparative research. In Scotland, the principle was applied initially, in the case of Mackintosh v. Mackintosh, but it came to an end in RHM Bakeries v. Strathclyde Regional Council. Lord Keith upheld the decision of the Scottish Court of Appeal, refusing to follow and doubting DHN v Tower Hamlets BC. It was argued, with reliance onD.H.N. Food Products Ltd. V. Tower Hamlets[v], it has been said that the Courts may disregard Salomons case whenever it is just and equitable to do so. Adams v Cape Industries plc and Another (1991) A worked for a US subsidiary of CI, which marketed asbestos in the US. In Woolfson v. Strathclyde Regional Council it was held that the veil could be pierced where special circumstances exist indicating that the company is a faade concealing the true facts. It was held that the film could not be considered British made, even though the company owning the rights was a UK company. 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'. UK legal case. reasons for lifting the veil of incorporation circumstances when the veil is lifted are haphazard and difficult to categorize. It carried on no activities whatever. and another 1984 - CA. But the shop itself, though all on one floor . 57 St. George's Road. There the company that owned the land was the wholly owned subsidiary of the company that carried on the business. . 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. Woolfson v Strathclyde Regional Council (1978): . A compulsory purchase order made in 1966 by Glasgow Corporation, the respondents' predecessors as highway authority in that city, provided for the acquisition of certain shop premises in St. George's Road, the date of entry being 29th January 1968. The circumstance that Solfred owned a substantial part of the shop premises was for purposes of this argument dismissed as irrelevant, on the basis that the part of the premises owned by Woolfson was essential to the carrying on of Campbells business, so that without it the business would have to be carried on, if at all, at some completely different place. References Draft leases were at one time prepared, but they were never put into operation. Lifting the Corporate Veil 287 which it already possessed. It is unnecessary for me to rehearse them in detail, and it will suffice to mention those that are particularly material. 95 (Eng.) Woolfson v Strathclyde Regional Council [1978] UKHL 5 is a UK company law case concerning piercing the corporate veil. country. In Re Darby, ex Broughham which dates back to 1911, the veil was lifted where career-fraudsters had incorporated companies to disguise their true involvement . Salomon v Salomon [1896] UKHL 1. However there are many such situations and this paper hashighlightedfew of them. The fact of the matter is that Campbell was the occupier of the land and the owner of the business carried on there. that the group was entitled to compensation for disturbance as owners of the business. 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. 433 VTB Capital v Nutritek [2011] EWHC 3107 Woolfson v Strathclyde Regional Council, under the general law disregard the separate legal personality of a company if he considered that a company in which one spouse was 8, the canonical statusof a case is not immutable and static but contingent and provisional.547136 Woolfson v. Strathclyde Regional Council, (1998) 43 NSWLR 554, 557 (Sheller JA). It was held by the Court of Appeal (Lord Denning M.R., Goff and Shaw LL. the separate personality of a company is a real thing. Subscribers are able to see any amendments made to the case. 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. Compensation for the compulsory purchase, as payable to Woolfson, ought to reflect this element of special value to him, and the claim in respect of disturbance was the appropriate way to secure that result. In Gilford Motor Co. Ltd. V. Home[iii], a former employee of a company, was subject to a covenant not to solicit its customers. Company Law Cases List of the Major Cases in Company Law; Reading 2 - Test FCE The oldest leather shoe in the world; Lab report - standard enthalpy of combustion; Multiple Choice Questions Chapter 16 Public Goods; Stage 1 Visit 1 efnwklf; Dd102 TMA-1 - Grade: 93%; Multiple Choice Questions Chapter 15 Externalities; 03.+Lulu+The+Lioness 3 961; [1996] CLC 990; (1996), 160 J.P. Rep. 1130; 146 New L.J. (160), 20Adam (n.18) [536] and [542]. a sufficient interest in the land to found a claim to compensation for disturbance and (3) (per Goff and Shaw LL.J.) Any direct loss consequent on disturbance would fall upon Campbell, not Woolfson. Bambers Stores [1983] F.S.R. Piercing the Corporate Veil? Some of our partners may process your data as a part of their legitimate business interest without asking for consent. The position there was that compensation for disturbance was claimed by a group of three limited companies associated in a wholesale grocery business. that in the circumstances Bronze held the legal title to the premises in trust for D.H.N., which also sufficed to entitle D.H.N. LORD WILBERFORCE.My Lords, I have had the advantage of reading in draft the speech to be delivered by my noble and learned friend Lord Keith of Kinkel. In re FG (films) Ltd[ii], FG films wanted Monsoon registered as a British film. It is unnecessary for me to rehearse them in detail, and it will suffice to mention those that are particularly material. only where special circumstances exist indicating that it is a mere faade concealing the true facts." The whole of the shop premises was occupied by a company called M. & L. Campbell (Glasgow) Limited (Campbell) and used by it for the purpose of its business as costumiers specialising in wedding garments.
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