Directors The Senior Persons Of The Company-Myassignmenthelp.Com

Question: Discuss About The Directors The Senior Persons Of The Company? Answer: Introducation The law considers the company as an artificial person which has distinct rights and duties from its stakeholders and directors. It is the important rule of the law that a company will have separate lawful existence but on the other hand the company does all activities through its stakeholder as, the company cannot do all its activities or dealings by itself. It can take all the actions by its members thus the company is introduced in corporate field by the work of its members. All important persons of the company who regulate the activities and who have control over all the dealings related to company are considered as the key personnels in the company. These are the directors and the senior persons of the company hence due to huge influence over the companys activities, the law considered all the director and senior persons as the directing mind and will of the company. Further, the theory of identification came from the very famous case where the court laid down that the company is known for its workers activities (Lennard's Carrying Co Ltd v Asiatic Petroleum Co Ltd (1915) AC 705). In the current case, the Supreme Court held liable all the stakeholders of the company as the client of the company suffered loss due to the investment scheme of the company (Sugarloaf Hill Nominees Pty Ltd v Rewards Projects Ltd(2011)WASC). Piercing of corporate veil The corporate veil is a legal thought in the corporational law which creates the boundaries between the company and companys member and automatically creates a separate legal entity for the company that too different from its stakeholders. Through corporate veil all the working person of the company can defend themselves from the liability in matter of debt and any other duty and also the stakeholder cannot be held liable for anything more than the shares that they hold in the company thus a stakeholder of the company cannot be held liable personally but on the other hand this is not an absolute aid if the activities of the company prejudice any provision of law or the organization is engaged in any illegal activity then the court has the power to make stakeholders personally liable for even more than his share contributed in the company. Further, there are two legal processes which lead to the cessation of the existence of corporate veil. The first process is lifting the corporate veil in which the court does not consider limited liability section and made responsible every member for the actions of the company as has been done by the member of the company Whereas in the second procedure of piercing corporate veil the court recognizes the power and obligation of the organization as the duty and right of the member. Thus the legal process of piercing corporate veil is the most controversial and prosecuted process in the commercial field as it is the most extensively used theory to recognize the responsibility of the member of the company (SSRN n.d). Reference Davidson, L., 2014, Piercing the corporate veil, viewed 14 September 2017, from: file:///C:/Users/Disha%20Goyal_JPR/Downloads/corporate_structures_piercing_veil_october2004%20(2).pdf Lennard's Carrying Co Ltd v Asiatic Petroleum Co Ltd (1915) AC 705 SSRN n.d., Lifting of Corporate Veil, viewed 14 September 2017, from: https://poseidon01.ssrn.com/delivery.php?ID=652087122068025070070081106103014027024044014043036071094111022081093091026005095126123009016061033059096098070091088069 115105106027069082063116025013113009014108092025086046083084075068086080118106111064102118126117112114119091105025100070006017 064004EXT=pdf Sugarloaf Hill Nominees Pty Ltd v Rewards Projects Lt