Q:

What was the Salomon v. Salomon case?

A:

Quick Answer

Salomon v. Salomon was a case in Great Britain in 1897 that established the concept of the "corporate veil," according to McGill University. This case established the corporation as a different entity than the people within the corporation, specifically the shareholders. The case also created legal liability against the corporation instead of an individual person.

Know More

Full Answer

Salomon v. Salomon involved the Salomon family, who owned the majority of shares in a leather company, according to The National Archives of the United Kingdom. After a strike, the business lost profits and went bankrupt. The value of the corporation at the time of insolvency was below the value of the debts. Creditors sued the individual shareholders for the rest of the funds. Even though the majority owner of the company was one family, the House of Lords held that a corporation is separate from the individuals. Only the corporation held the debt; the individual shareholders did not hold the debt. As part of a legal incorporation, the liability was more minimal than that of a partnership or sole proprietorship, according to Examination Preparation Services.

Though Salomon v. Salomon was a case in English common law, courts in other countries cite the case as part of corporate law, according to WIkipedia. Subsequent cases, however, limit the corporate veil and provide instances for lifting it.

Learn more about Law

Related Questions

  • Q:

    What is an independent witness?

    A:

    An independent witness is a third-party witness who does not have an affiliation with either parties involved in a case and someone who can present an unbiased opinion, as noted by Cornell University. Independent witnesses do not have anything invested in the outcome of a case, meaning the witness will not profit from the results of the case.

    Full Answer >
    Filed Under:
  • Q:

    What does "case dismissed" mean?

    A:

    The term "case dismissed" is used by courts to end a legal action prior to completing the trial process, according to USLegal. This action may occur prior to the start of the trial or during the trial in response to a filed motion.

    Full Answer >
    Filed Under:
  • Q:

    How do you prepare for small claims court in Houston?

    A:

    Prepare for small claims court by gathering the necessary information or supporting documentation that assists with the case. Many variables exist depending if one is the plaintiff or defendant in the case. Ensure that the court’s original paperwork for filing is available for both the plaintiff and the defendant, states the Harris County Justice of the Peace Courts.

    Full Answer >
    Filed Under:
  • Q:

    How do you report a bad lawyer?

    A:

    Serious complaints over the way a lawyer has handled a case are best referred to one's state bar association. This body regulates the professional conduct of lawyers and is responsible for investigating and, if necessary, prosecuting cases of misconduct. The State of Massachusetts Bar Association is typical in that it offers a public list of what constitutes misconduct worthy of a formal complaint.

    Full Answer >
    Filed Under:

Explore