Lord Keith says of the judgement of the Lord Justice-Clerk: approached the “He 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 in Salomon v. Salomon & Co. Ltd. 1897 A.C. 22 must normally receive full effect in relations between the company and persons dealing with it.” (Emphasis added.) It is not clear whether Lord Keith is attributing the view that Salomon must normally receive full effect to Lord Justice-Clerk or is stating that view himself. It is submitted that the latter is more likely. In either case, the use of the word ‘normally’ clearly implies that there will be cases when corporate personality will not ‘receive full effect’ At the end of his consideration of Woolfson, Lord Neuberger concludes that most that “The can be said Woolfson from the perspective of VTB is that the House was prepared to assume that the power [to pierce the veil] existed.” With respect, this is slightly misleading. Although the distinction is often ignored in common parlance, an assumption differs from a presumption in that an assumption is neutral about the truth or otherwise of a proposition, whereas a person making a presumption believes the relevant proposition to be correct (although the presumption may be rebutted). The language of Lord Keith’s speech is much more suggestive of a presumption than an assumption. It is submitted that most lawyers reading his judgement would conclude that he believed that the power to pierce the veil existed. Similarly and again, with respect, to say that the House prepared to assume’ (emphasis ‘was added) is linguistically questionable. It is not that the court prepared to assume’ it did ‘was assume (sic) that the power existed. The ratio in Salomon In his presumption that the power to pierce the veil existed, was Lord Keith ignoring a cardinal principle established by Salomon? Lord Neuberger commented that: is great “There force in the argument that [Salomon] represented an early attempt to pierce the veil of
Lord Keith says of the judgement of the Lord Justice-Clerk: “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 in Salomon v. Salomon & Co. Ltd. 1897 A.C. 22 must normally receive full effect in relations between the company and persons dealing with it.” (Emphasis added.) It is not clear whether Lord Keith is attributing the view that Salomon must normally receive full effect to Lord Justice-Clerk or is stating that view himself. It is submitted that the latter is more likely. In either case, the use of the word ‘normally’ clearly implies that there will be cases when corporate personality will not ‘receive full effect’ At the end of his consideration of Woolfson, Lord Neuberger concludes that “The most that can be said Woolfson from the perspective of VTB is that the House was prepared to assume that the power [to pierce the veil] existed.” With respect, this is slightly misleading. Although the distinction is often ignored in common parlance, an assumption differs from a presumption in that an assumption is neutral about the truth or otherwise of a proposition, whereas a person making a presumption believes the relevant proposition to be correct (although the presumption may be rebutted). The language of Lord Keith’s speech is much more suggestive of a presumption than an assumption. It is submitted that most lawyers reading his judgement would conclude that he believed that the power to pierce the veil existed. Similarly and again, with respect, to say that the House ‘was prepared to assume’ (emphasis added) is linguistically questionable. It is not that the court ‘was prepared to assume’ it did assume (sic) that the power existed. The ratio in Salomon In his presumption that the power to pierce the veil existed, was Lord Keith ignoring a cardinal principle established by Salomon? Lord Neuberger commented that: “There is great force in the argument that [Salomon] represented an early attempt to pierce the veil of
Nutritek%20company%20lawyer1.2.docx