Liability For Unpaid Employee Entitlements †Myassignmenthelp.Com

Question: Discuss About The Liability For Unpaid Employee Entitlements? Answer: Introducation Directing mind and will is a phrase which refers to the identification of such set of natural person(s), who have the control over the acts of the company, along with its management. The concept of directing mind and will has evolved through a number of cases, both in civil in criminal jurisdiction. This concept was contextualized by Lord Hoffman through the case of Meridian Global Funds Management Asia Ltd v Securities Commission [1995] UKPC 5, which was a Privy Council decision. Another example of the use of this concept was that of Citizens United v. Federal Election Commission 558 U.S. 310 (2010) (Ferran, 2012). The company is, in general fixed with the state of mind of such people or person who are directing both the will and the mind of the company. As a result of this, the company is deemed to have the knowledge of any such thing, which an individual who had been involved in its direction of will and mind, knew of. An example of this can be seen in El-Ajou v Dollar Land Holdings Plc [1994] 2 All E.R. 685 where the non-executive chairman of the company had organized the thieves would invest the stolen money into the company. This led to the Court of Appeals stating that the chairman of the company was the one who was directing the will and mind of the company with regards to this particular transaction. And this was held even when the chairman did not ordinarily hold the daily management of the affairs of the company (Hudson, 2017). Piercing the Corporate Veil Piercing of the corporate veil of the company refers to setting aside the separate legal entity status of the company and holding the ones running the business of the company, liable for the debts or the misdeeds conducted through the company, for the sake of avoiding their personal liabilities. This concept was born through the case of Salomon Co Ltd [1897] AC 22 and has been since then used numerous of times, even though, at times, it proves to be controversial. This was the very first case where the court pierced the veil of the company and made Salomon liable for the debts of the company (Monaghan, 2015). In order to pierce the corporate veil, there has to be justifiable grounds before the court to do so. A corporate veil is pierced only when the court deems it necessary for the purpose of justice and for being fair, to hold the ones responsible for the conduct of the business, liable personally for the undertaken actions. CSR Ltd v Young [1998] Aust Tort Reports 81-468 was a case where the tortious liability of the subsidiary company was in question. In this case, the judges held that the position of the parent company was identical to its subsidiary company and as a result of this, the corporate veil was pierced and the parent company was made liable for the tortious acts undertaken by the subsidiary company (Anderson 2008). References Anderson, H. (2008) Directors Liability for Unpaid Employee Entitlements: Suggestions for Reform Based on their Liabilities for Unremitted Taxes. Sydney Law Review, 30(470). Ferran, E. (2012) Corporate Attribution and the Directing Mind and Will. [Online] University of Cambridge. Available from: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2025884 [Accessed on: 19/09/17] Hudson, A. (2017) Understanding Company Law. 2nd ed. Oxon: Routledge. Monaghan, C. (2015) Beginning Business Law. Oxon: Routledge.