3.You will be required to provide an analysis of the following Cases –Salomon v Salomon and Company...

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3.You will be required to provide an analysis of the following Cases  –Salomon v Salomon and Company Ltd [1879]All E Rep 33  –Australian Securities and Investments Commission v Healey [2011] FCA XXXXXXXXXXJune 2011)  –    For both cases provide the following;  1.What court was the matter heard;  2.Name the judges who sat on the case;  3.Outline the facts;  4.Outline the decision of the court;  5.Why is this decision significant to the law of companies and associations;
	
Document Preview: 3.  RequirementsStudents are required to complete the assignment in groups of 4 or 5. Students who have difficulty finding a group should consult the lecturer. 4.  PresentationEach group is to submit a single copy of their assignment on Moodle. Presentation must include the followings:Cover page: showing your name, student number, the subject name, the subject code the case topic, and the date of submission. UIC assignment cover page is also need to be attached with the assignment.List of references – an alphabetical listing of the works to which you have referred. The preferred referencing system is the author-date (Harvard) system. If you use material written by others, including other students or colleagues, it must be referenced. If it is not, you are plagiarising and this is a practice not tolerated at UIC.Individual students should not lodge a cover page – Lodge only the group assignment.5.  Assessment criteriaIn assessing submitted assignments consideration will be given to overall neatness, completeness and quality of presentation, timeliness of submission and demonstrated application of appropriate corporate accounting understanding.The assignment must not exceed 1500 words marks will be deducted where the word limit is exceeded.6.PlagiarismTaking another person’s ideas, words or inventions and presenting them as your own without acknowledging your sources (citing or referencing), is plagiarism. Paraphrasing or rewording another person’s work, without acknowledging its source, is also plagiarism. If you are identified as Plagiarizing the assignment penalties will be imposed.7. Referencing Correct referencing is important for two main reasons. The first is to enable the reader to access source material you have relied upon, should they care to. The other is to ensure that you have properly recognized the contribution of the work of others to your assignment. If you do not do this properly, you are engaging in plagiarism—the theft,...

Robert · Accepted Answer

1
Salomon Vs Salomon Co. ltd  
This case is a leading case in the history of law. The Companies Act 1862 which governs all the 
companies across the globe had to amend the law after the ruling in this case was passed by the 
House of Lords in United Kingdom. The judgment in this case upholds the law in Doctrine of 
Corporate Personality. The doctrine clearly states that an entity and its shareholders are 
extremely separate from each other. As per this doctrine the directors of the company and the 
company are two separate legal entities. The directors of the company cannot be held personally 
liable for breach conducted by the company or its shareholder. Company is a separate legal 
person and can sue or can be sued in its own name. It has no relation with the director in case a 
breach has been conducted. So a company is legally different from its directors and so it can 
have a property in its own name. The liability of the shareholders or directors is limited as the 
debts are the responsibility of the company and not the shareholders.  
Facts of the case 
Salomon was a leather merchant who formed the company Salomon & Salomon Company with 
his wife and 5 children, each one having one share each. The companies Act required to have 
seven shareholders so the family was holding shares for Solomon.  This new company bought a 
leather business for £39000 by way of £10000 debentures secured through the assets of the 
company. It was also agreed that if Solomon could not pay the debt then in such a case the assets 
of the company shall be disposed off to pay money with £20000 of £1 share and £9000 in cash. 
He paid the creditors in full settlement. So in total he had 20001 shares of the company. Solomon 
was the managing director as well as a secured creditor of the company (Kucchal, 2000).  
But due to rough business, Solomon sold his own debentures for saving business. Soon the 
company became insolvent. A liquidator was appointed to settle the company’s assets. He 
proved that company was a con and façade. It was acting as the agent of Solomon so he should 
be liable to clear all the debts incurred in the name of the company.  
The House of Lords consisting of  Lord Halsbury LC, Lord Herschell, Lord Macnaghten did not 
agree with the liquidator. It upheld that Company was a separate legal entity incorporated and 
working as per the Companies Act.

3. You will be required to provide an analysis of the following Cases – Salomon v Salomon and Company Ltd [1879] All E Rep 33 – Australian Securities and Investments Commission v Healey [2011] FCA...

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