misrepresent or mislead arguably avoided mistake at least cost (Tato Enterprises Ltd. persons into believing equity v. Rode) investors will not have LL to Even if P appears not to have relied or type of business avoid premiums being incorporated, shareholder(s) of company may still be PCV allows to personally liable as it would have been difficult for P to compensate persons who make inquiries since they had failed to register the bus are misled and creates an name (not complying with legislatio) (Roydent Dental incentive for those Products Inc. v. Inter-dent Int’l Dental Supply Co. of Canada) transferring bus assets to D may be held personally liable where (even when P corp entities to inform didn’t rely on LL) the corporate name was not used and by persons who previously not following statutory requirements, took the risk of being dealt with them held personally liable (Wolfe v. Moir) Nothing in the statute says that the consequence of not using the cautionary suffix is the disregarding of the corporate entity. If the corporate name had been displayed it is unlikely Wolfe have made a different decision about roller-skating. Non-Consensual Claimants and Incentive Costs Greater willingness to PCV in Perfect example of an involuntary claimant would be the situation were is a tort victim of a tort committed in the carrying on of the business claimant, were person had enterprise no intention to deal with Compensation the corp entity may be disregarded in – corporation (non-consensual order to compensate a tort victim (the assets of a corp may claimant) (Wolfe but not in not be sufficient to fully compensate the victim) Walkovsky) Imposing liability on a deliver bus, for example, for reckless drivers with incentive to deliver quickly injuring claimants, could create an incentive for manager to take this risk into account when devising a method for compensating drivers A Tort action against director or officer directly, is another way of disregarding the corporate entity (shareholders are often directors/officers). It will not just be the corporation that is vicariously liable, the employees/directors/officers will also be directly liable (Berger v. Willowdale A.M.C.) Policy: Could overcome the trap” problem and restore the incentive to take “deterrence sufficient care however, this could lead to managers over protecting themselves at – expense of investors could be controlled by indemnifying directors/officers through – insurance
misrepresent or mislead persons into believing equity investors will not have LL to avoid premiums PCV allows to compensate persons who are misled and creates an incentive for those transferring bus assets to corp entities to inform persons who previously dealt with them arguably avoided mistake at least cost (Tato Enterprises Ltd. v. Rode) Even if P appears not to have relied or type of business being incorporated, shareholder(s) of company may still be personally liable as it would have been difficult for P to make inquiries since they had failed to register the bus name (not complying with legislatio) (Roydent Dental Products Inc. v. Inter-dent Int’l Dental Supply Co. of Canada) D may be held personally liable where (even when P didn’t rely on LL) the corporate name was not used and by not following statutory requirements, took the risk of being held personally liable (Wolfe v. Moir) Nothing in the statute says that the consequence of not using the cautionary suffix is the disregarding of the corporate entity. If the corporate name had been displayed it is unlikely Wolfe have made a different decision about roller-skating. Non-Consensual Claimants and Incentive Costs Greater willingness to PCV in situation were is a tort claimant, were person had no intention to deal with corporation (non-consensual claimant) (Wolfe but not in Walkovsky) Perfect example of an involuntary claimant would be the victim of a tort committed in the carrying on of the business enterprise Compensation – the corp entity may be disregarded in order to compensate a tort victim (the assets of a corp may not be sufficient to fully compensate the victim) Imposing liability on a deliver bus, for example, for reckless drivers with incentive to deliver quickly injuring claimants, could create an incentive for manager to take this risk into account when devising a method for compensating drivers A Tort action against director or officer directly, is another way of disregarding the corporate entity (shareholders are often directors/officers). It will not just be the corporation that is vicariously liable, the employees/directors/officers will also be directly liable (Berger v. Willowdale A.M.C.) Policy: Could overcome the “deterrence trap” problem and restore the incentive to take sufficient care – however, this could lead to managers over protecting themselves at expense of investors – could be controlled by indemnifying directors/officers through insurance
Unknown%20-%20315%20Business%20Associations%20-%20Final%202008.docx