A Real Thing: Saloman v. A. Saloman & Co Ltd
The Hamlyn Lectures: Turning Points of the Common Law (1997)
Victoria University of Wellington Legal Research Paper Series, Cooke Paper No. 27/2016
28 Pages Posted: 17 Jan 2013 Last revised: 17 Aug 2016
Date Written: January 17, 1997
Abstract
This article is the first of four in Lord Cooke’s Hamlyn Lectures, in which he explores four English cases that have signalled turning points in the evolution of the common law. Lord Cooke examines the limited liability of companies as explained and developed in Saloman v A Saloman & Co Ltd [1897] AC 22, where the House of Lords held that a company had a legal entity separate to its shareholders. Lord Cooke observes the popular use of limited liability companies for business globally, then discusses “piercing the corporate veil” as a limitation to this principle. He argues that there is only one class of cases in which limitations imposed on the limited liability company are truly consistent with Saloman. That class of cases involves fraud or oppression. Lord Cooke critiques a second class of cases, where the corporate vehicle is used as a façade or sham to conceal the true facts, and argues that the sham doctrine is unnecessary because the limits of limited liability companies are better demarcated by through other principles, such as the public policy doctrine. Finally, Lord Cooke considers the law relating to attribution, identification, and vicarious liability in relation to limited liability companies.
Keywords: Lord Cooke, Hamlyn lectures, Saloman, limited liability, companies, corporate veil, sham doctrine, fraud, oppression, public policy, attribution, identification, vicarious liability
JEL Classification: K10, K22
Suggested Citation: Suggested Citation