the enactment of the New Companies Act.1 A company‚ as a separate entity‚ is an acknowledged concept in South African law. It is clearly stated in the Constitution: A provision of the Bill of Rights binds a natural or a juristic person if‚ and to the extent that‚ it is applicable‚ taking into account the nature of the right and the nature of the duty imposed by the right.2 Although a company is acknowledged as a separate entity‚ it is common sense that a company cannot act by itself‚ because
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OF THECORPORATE VEIL BY: Amandeep Kaur BBA Sem. 4 2. CONCEPT• In the eyes of law‚ a company is a legal person with a separate entity distinct from its members of shareholders. In essence it means that there is a veil or curtain separating the legal entity of the company from its members or shareholders.• When any fraudulent and dishonest use is made of the legal entity‚ the individuals concerned will not be allowed to take shelter behind the corporate personality. The Courts will break through the
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A ’sole proprietorship‚ also known as the sole trader or simply a proprietorship‚ is a type of business entity that is owned and run by one individual and in which there is no legal distinction between the owner and the business. The owner receives all profits (subject to taxation specific to the business) and has unlimited responsibility for all losses and debts. Every asset of the business is owned by the proprietor and all debts of the business are the proprietor ’s. It is a "sole" proprietorship
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note that even before this was recognized so expressly in the law‚ juridical personality was a natural consequence of principles governing commercial partnerships as early as 1908.4 According to Lee the general notion of a corporation as a legal entity distinct from its members may have already been familiar to the lawyers of the classical age;5 Si quid universitati debetur‚ singulis non debetur; nee quod debet universitas singuli debent.6 A company’s separate personality gives rise to important
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They look to see what really lies behind. The legislature has shown the way… the courts should follow suit”.[1] When a company is incorporated‚ it is treated as a separate legal entity‚ distinct from its promoters‚ directors‚ members and employees and hence the concept of the corporate veil‚ separating those entities from the corporate body has arisen. The nature of corporate personality can be analysed by reference to the celebrated case of Salomon v. A. Salomon & Co. Ltd.[2] Indeed it has been
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M E M O R A N D U M TO: Client FROM: DATE: November 16‚ 2011 RE: Suggestive Business Entity for Cure of Cancer Question Presented What business entity would be best suited in order to create the enterprise for the client’s scientific cure of cancer‚ while keeping his main interests in mind: to get assistance in running the business portion of the enterprise‚ while limiting his personal liability; and providing investors with the most profit possible while limiting the scope of the
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a company grows it may become necessary to change the businesses’ entity and the way in which it conducts business. ACME Fireworks has received inquiries from several large retailers that will enable the business to expand. In order to accommodate this expansion‚ ACME must consider hiring more employees. The owner is concerned about his personal liability should the company fall short of funds. In order to determine which entity best suits the company’s needs‚ we must first review all the risks
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Forms of Business Organization Western Governors University The study of business organization is a study of complexity: as each business is different‚ each form of business organization is also unique. From a local hot-dog vendor to a trucking company‚ from a restaurant to a multinational‚ each business has different legal‚ moral and ethical concerns‚ and there is no "one-size-fits-all" approach to determine how a business should best be organized. Take the first two businesses
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is owned by an individual who is solely responsible for all aspects of the business. The owner is personally responsible for all debts of the business‚ even in excess of the amount invested. The business and its owner are thus considered the same entity. The advantages of a sole proprietorship include: a. Low start up costs‚ as legal and filing fees are at a minimum. However‚ many states and cities require a filing with county clerk. b. Greatest freedom from regulation and paperwork. c. Owner
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business has a legal personality in its own right‚ particularly when it assumes the form of a limited liability company. This essentially means that if one commences business as a limited liability company‚ then the corporation or company is a legal entity with distinct legal personality separate to that of the owners‚ members‚ or shareholders. This is known as the concept of legal personality. The ’veil of incorporation
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