Corporate Law and Governances

Question: The principle established in Salomon v. Salomon Ltd continues to underpin company law in England Wales. However, the courts are prepared to ignore the veil of incorporation in order to prevent abuse. Assess the circumstances in which the veil of incorporation may be ignored and the effectiveness of such exemptions to the general rule. Instructions: Prepare a short essay (approximately 500-800 words) on the above topic. Please use the leading case of Salomon v. Salomon and the recent decisions of Prest v Petrodel Resources Ltd[2013] UKSC 34 and VTB Capital plc (Appellant) v Nutritek International Corp and others (Respondents) to support and discuss your essay. Please use OSCOLA referencing. Below you can find important points to include in your essay: You should begin by clearly setting out the doctrine of corporate personality and explaining the decision in Salomon. This should be followed by an explanation of the effects of limited liability and its attraction to shareholders and directors, together with a description of the ‘veil of incorporation’. Having established the principle of corporate personality you should then address the exceptions to the general rule, which are all based on a desire to prevent the corporation from being abused. Through the statutory and common law exemptions and try not only to state what the exemption is but also to offer some view on how effective or otherwise you consider it to be. Finally, provide a conclusion which addresses the questions and which provides some opinion on the central proposition – the effectiveness of the exceptions.