Woolfson v Strathclyde RC [1978] UKHL 5 (15 February 1978) admin March 8, 2020 INTERNATIONAL / U.K. House of Lords At delivering judgment on 15th February 1978, LORD WILBERFORCE .My Lords, I have had the advantage of reading in draft the speech to be delivered by my noble and learned friend Lord Keith of Kinkel. This is an appeal against an interlocutor of the Second Division of the Court of Session affirming the decision of the Lands Tribunal for Scotland upon a question relating to compensation for the compulsory acquisition of land. It was maintained before this House that the conclusion of the Lord Justice-Clerk was erroneous. Food Distributors case (supra) is, on a proper analysis, of assistance to the appellants' argument. The court was asked as to the power of the court to order the transfer of assets owned entirely in the companys names. 2023 Legalease Ltd. All rights reserved, Registered company in England & Wales No. Of Landmark or Leading Cases: Salomon's Challenge. (160), 20Adam (n.18) [536] and [542]. WOOLFSON V. STRATHCLYDE REGIONAL COUNCIL 521 Woolfson and Another v. Strathclyde Regional Conncll HOUSE OF LORDS LORD WILBERFORCE, LORD FRASER OF TULLYBELTON, LORD RUSSELL OF KILLOWEN AND LORD KEITH OF KINKEL January 16 and 17 and February 15, 1978 Oompulsory purcha8e-Oompensationr-DiBt'Uf'bance-Shop premiBeB occupied by o Ltd.-U8ed by 0 Ltd. Jor purp08es oj its busine8a-Part oj premises owned . To browse Academia.edu and the wider internet faster and more securely, please take a few seconds toupgrade your browser. Nos. He said that DHN was easily distinguishable because Mr Woolfson did not own all the shares in Solfred, as Bronze was wholly owned by DHN, and Campbell had no control at all over the owners of the land. No. In my opinion there is no basis consonant with principle upon which on the facts of this case the corporate veil can be pierced to the effect of holding Woolfson to be the true owner of Campbell's business or of the assets of Solfred. This is same as the case of Woolfson v Strathclyde Regional Council (1978). woolfson v strathclyde regional council case summary About; Sponsors; Contacts A compulsory purchase order made in 1966 by Glasgow Corporation, the respondents' predecessors as highway authority in that city, provided for the acquisition of certain shop premises in St. George's Road, the date of entry being 29th January 1968. Lord Keith's judgment dealt with DHN as follows. Before making any decision, you must read the full case report and take professional advice as appropriate. I agree with it, and for the reasons he gives would dismiss the appeal. The court looked to the reality of the situation ignored the transfer, and ordered that the company should convey the land to J. Menu However, the House of Lords did not elaborate on the nature of such special circumstances or the meaning of faade. and another, [1984]) . IMPORTANT:This site reports and summarizes cases. Please contact Technical Support at +44 345 600 9355 for assistance. that the group was entitled to compensation for disturbance as owners of the business. There the company that owned the land was the wholly owned subsidiary of the company that carried on the business. From the paper "Limits of Employment-At-Will Doctrine" it is clear that the employment at will doctrine has its own limits. 12 89 Ord v Belhaven Pubs Ltd [1998] BCC 607, CA 90 Woolfson v. Strathclyde Regional . Woolfson v Strathclyde Regional Council: HL 15 Feb 1978 - swarb.co.uk Woolfson v Strathclyde Regional Council: HL 15 Feb 1978 The House considered the compensation payable on the compulsory purchase of land occupied by the appellant, but held under a company name. A bridal clothing shop at 53-61 St George's Road was compulsorily purchased by the Glasgow Corporation. 116. Here, on the other hand, the company that carried on the business, Campbell, has no sort of control whatever over the owners of the land, Solfred and Woolfson. 95 (Eng.) 40 Nbr. Only full case reports are accepted in court. edit. Woolfson holds two-thirds only of the shares in Solfred and Solfred has no interest in Campbell. The issued share capital of Campbell was 1,000 shares, of which 999 were held by Woolfson and one by his wife. The issued share capital of Campbell was 1,000 shares, of which 999 were held by Woolfson and one by his wife. Wikiwand is the world's leading Wikipedia reader for web and mobile. How does the decision in DHN Food Distributors Ltd v Tower Hamlets LBC [1976] 1 WLR 852 compare with the decision in Woolfson v Strathclyde Regional Council 1978 SLT 159? The Land Tribunal denied it on the basis that Campbell Ltd was the sole occupier. This website uses cookies to improve your experience. . The business in the shop was run by a company called Campbell Ltd. Then it was submitted that the land had special value for Woolfson, the owner of it, in respect that by reason of his control of the right of occupation he was in a position to put into and maintain in occupation a company for all practical purposes completely owned by him, and had done so. Upon Report from the Appellate Committee, to whom was referred the Cause Woolfson and others against Strathclyde Regional Council (as Successors to The Corporation of the City of Glasgow), That the Committee had heard Counsel, as well on Monday the 16th as on Tuesday the 17th, days of January last, upon the Petition and Appeal of (one) Solomon Woolfson, 30 Restan Road, Newlands, Glasgow and (two) Solfred Holdings Limited, a Company incorporated under the Companies Acts and having their Registered Office at 18/28 Woodlands Road, Glasgow, praying, That the matter of the Interlocutor set forth in the Schedule thereto, namely, an Interlocutor of the Lords of Session in Scotland, of the Second Division, of the 3rd of December 1976, might be reviewed before Her Majesty the Queen, in Her Court of Parliament, and that the said Interlocutor might be reversed, varied or altered, or that the Petitioners might have such other relief in the premises as to Her Majesty the Queen in Her Court of Parliament, might seem meet; as also upon the case of Strathclyde Regional Council (as Successors to the Corporation of the City of Glasgow), lodged in answer to the said Appeal; and due consideration had this day of what was offered on either side in this Cause: It is Ordered and Adjudged, by the Lords Spiritual and Temporal in the Court of Parliament of Her Majesty the Queen assembled, That the said Interlocutor of the 3rd day of December 1976, complained of in the said Appeal, be, and the same is hereby, Affirmed, and that the said Petition and Appeal be, and the same is hereby, dismissed this House: And it is further Ordered, That the Appellants do pay, or cause to be paid, to the said Respondents the Costs incurred by them in respect of the said Appeal, the amount thereof to be certified by the Clerk of the Parliaments: And it is also further Ordered, That unless the Costs, certified as aforesaid, shall be paid to the party entitled to the same within one calendar month from the date of the Certificate thereof, the Cause shall be, and the same is hereby, remitted back to the Court of Session in Scotland, or to the Judge acting as Vacation Judge, to issue such Summary Process or Diligence for the recovery of such Costs as shall be lawful and necessary. 59/61 St. George's Road were credited to Woolfson in Campbell's books. In-text: (Woolfson v Strathclyde Regional Council, [1978]) Your Bibliography: Woolfson v Strathclyde Regional Council [1978] EGLR 2, p.19. 33 (1), sect. that in the circumstances Bronze held the legal title to the premises in trust for D.H.N., which also sufficed to entitle D.H.N. Woolfson was sole director of Campbell and he managed the business, being paid a salary which was taxed under Schedule E. His wife also worked for Campbell and provided valuable expertise. We and our partners use cookies to Store and/or access information on a device. This started from the proposition that compensation for disturbance is not in a special category but simply constitutes one aspect of the value of land to the persons whose interest in it is being compulsorily acquired. References The fact of the matter is that Campbell was the occupier of the land and the owner of the business carried on there. [i] Daimler Company, Limited Appellants v Continental Tyre and Rubber Company (Great Britain) HL [1916] 2 AC 307, [ii] In re FG (films) Ltd, [1953] 1 WLR 483, [iii] Gilford Motor Co. Ltd. V. Home, (1933) Ch. Woolfson v Strathclyde Regional Council [1978] UKHL 5 is a UK company law case concerning piercing the corporate veil. Bronze had the same directors as D.H.N. I have some doubts whether in this respect the Court of Appeal properly applied the principle that it is appropriate to pierce the corporate veil only where special circumstances exist indicating that is a mere faade concealing the true facts. A bridal clothing shop at 53-61 St Georges Road was compulsorily purchased by the Glasgow Corporation. No rent was ever paid or credited in respect of No. All rights reserved. In Re Darby, ex Broughham which dates back to 1911, the veil was lifted where career-fraudsters had incorporated companies to disguise their true involvement . We do not provide advice. 90 (15 February 1978) Links to this case Content referring to this case We are experiencing technical difficulties. PDF Lifting, Piercing and Sidestepping the Corporate Veil Ord v Belhaven Pubs Ltd [1998 . And one of them is to subscribe to our newsletter. The compulsory acquisition resulted in the extinction of the grocery business, since no suitable alternative premises could be found. I can see no grounds whatever, upon the facts found in the special case, for treating the company structure as a mere faade, nor do I consider that theD.H.N. On the contrary, the fundamental principle is that each company in a group of companies is a separate legal entity possessed of separate legal rights and liabilities. Continue with Recommended Cookies. 57 and 59/61 St. George's Road were owned by the first-named appellant Solomon Woolfson ("Woolfson") and Nos. It is unnecessary for me to rehearse them in detail, and it will suffice to mention those that are particularly material. Applied - Woolfson v Strathclyde Regional Council HL 15-Feb-1978 The House considered the compensation payable on the compulsory purchase of land occupied by the appellant, but held under a company name. They had twenty and ten shares respectively in Solfred Ltd. Mr Woolfson and Solfred Ltd claimed compensation together for loss of business after the compulsory purchase, arguing that this situation was analogous to the case of DHN v Tower Hamlets LBC. The case was heavily doubted by the Court of Appeal in Ord v Belhaven Pubs Ltd. . inTunstall v. Steigmann[1962] 2 Q.B. Topic 3 Corporate Personality 1 PART A SEPARATE LEGAL PERSON PRINCIPLE 2 The Salomon case: separate legal entity Company is a legal (H.L.) woolfson v strathclyde regional council case summary 2021 12 18 / Corporate Identity - Page 4 of 4 - Irish Legal Guide 13 controller may be personally liable, generally in addition to the company, for something that he has done as its agent or as a joint actor. 53/55 St Georges Road. Adams and others v. Cape Industries Plc. From 1962 till 1968 Campbell paid rent to Solfred in respect of Nos. This argument was rejected by the court for the reasons given in the opinion of the Lord Justice-Clerk. Note that since this case was based in Scotland, different law applied. To view the purposes they believe they have legitimate interest for, or to object to this data processing use the vendor list link below. 2427356 VAT 321572722, Registered address: 188 Fleet Street, London, EC4A 2AG. Draft leases were at one time prepared, but they were never put into operation. Copyright 2020 Lawctopus. 159 HOUSE OF LORDS (Lord Wilberforce, Lord Fraser of Tullybelton, Lord Russell of Killowen and Lord Keith of Kinkel) 15 February 1978 29. [iv] Jones v. Lipman and Another (1962) 1 WLR 832 L. [v] D.H.N.food products Ltd. V. Tower Hamlets, LBC [1976] 1 WLR 852, [vi] Woolfson v Strathclyde Regional Council, [1978] SC (HL) 90, [vii] Adam v Cape Industries Plc, [1990] Ch 433, [viii] Woolfson v Strathclyde Regional Council, [1978] SC (HL) 90, [ix] Ord & Another v Belhaven Pubs Ltd, [1998] 2 BCLC 447, [x] Prest v Petrodel Resources Ltd and Others, [2013] UKSC 34, [xi]Gramophone and typewriter, Ltd v Stanley, [1908] 2 KB 89, Give it a try, you can unsubscribe anytime :), Get to know us better! From 1952 until 1963, when Schedule A taxation was abolished, payments by way of rent for Nos. Updated: 07 December 2022; Ref: scu.279742. Applied - Woolfson v Strathclyde Regional Council HL 15-Feb-1978 The House considered the compensation payable on the compulsory purchase of land occupied by the appellant, but held under a company name. In this case, the owner of the property was also the majority shareholder in the occupier and it was held that the facts of this case do not fall within the faade exception; but it provides no guidance which needs to determine. Mr Woolfson had 999 shares in Campbell Ltd and his wife the other. Note that since this case was based in Scotland, different law applied. 3 Woolfson v. Strathclyde Regional Council [1978] SLT 159, confirmed by the Court of Appeal in Adams v. Cape Industries Plc [1990] 2 WLR 657. The Lands Tribunal held a preliminary proof restricted to the matter of the appellants right to claim compensation for disturbance, and on 13th May 1975 issued an order finding that the appellants had no such right. It uses material from the Wikipedia article "Woolfson v Strathclyde Regional Council". The position there was that compensation for disturbance was claimed by a group of three limited companies associated in a wholesale grocery business. Language Label Description Also known as; English: Woolfson v Strathclyde Regional Council. We and our partners use data for Personalised ads and content, ad and content measurement, audience insights and product development. portugal vs italy world cup qualifiers 2022. la liga 2012 13 standings. The circumstance that Solfred owned a substantial part of the shop premises was for purposes of this argument dismissed as irrelevant, on the basis that the part of the premises owned by Woolfson was essential to the carrying on of Campbells business, so that without it the business would have to be carried on, if at all, at some completely different place. Lord Keith's judgment dealt with DHN as follows. Woolfson v Strathclyde Regional Council UKHL 5 is a UK company law case concerning piercing the corporate veil. Woolfson v. Strathclyde Regional Council 1978 S.L.T. 6 Adams v Cape Industries Plc [1990] Ch 433 (CA). But the shop itself, though all on one floor, was composed of different units of property. From 1952 until 1963, when Schedule A taxation was abolished, payments by way of rent for Nos. Petrodel Resources Ltd (PRL), which was incorporated in the Isle of Man, was the legal owner of the matrimonial home and five other residential properties in the United Kingdom. Woolfson v Strathclyde Regional Council [viii] that the House of Lords considered that there is one circumstance in which the corporate veil can pierce, namely when there is one circumstance in which the corporate veil can be pierced, namely when there are special circumstances indicating a faade concealing the true facts. But however that may be, I consider the D.H.N. Their scientific name, Phascolarctos cinereus, is derived from several Greek words meaning pouch bear (phaskolos arktos) and having an ashen appearance (cinereus). I agree with it, and for the reasons he gives would dismiss the appeal. Subscribers are able to see a visualisation of a case and its relationships to other cases. It is unnecessary for me to rehearse them in detail, and it will suffice to mention those that are particularly material. Enter the email address you signed up with and we'll email you a reset link. Piercing the corporate veil old metaphor, modern practice? Subscribers are able to see a list of all the documents that have cited the case. In so far as Woolfson would suffer any loss, that loss would be suffered by virtue of his position as principal shareholder in Campbell not by virtue of his position as owner of the land. It carried on no activities whatever. 1 reference. It was held that the film could not be considered British made, even though the company owning the rights was a UK company. Nos. Therefore, English courts have shown a strong determination not to embark on any development of a group enterprise law. .Cited Prest v Petrodel Resources Ltd and Others SC 12-Jun-2013 In the course of ancillary relief proceedings in a divorce, questions arose regarding company assets owned by the husband. (H.L.) But opting out of some of these cookies may have an effect on your browsing experience. Lifting the Corporate Veil 287 which it already possessed. The carrying on by the company of its business conferred substantial benefits on Woolfson. reasons for lifting the veil of incorporation circumstances when the veil is lifted are haphazard and difficult to categorize. 53-61 St George's Road Glasgow Corporation . Mr Solomon Woolfson owned three units and another company, Solfred Holdings Ltd owned the other two. The argument is in my opinion unsound, and must be rejected. But the shop itself, though all on one floor . In Canada, the case of Ernst v. EnCana Corporation was inspired by the rule of Rylands v Fletcher. Introduction Woolfson v Strathclyde Regional Council He said that DHN was easily distinguishable because Mr Woolfson did not own all the shares in Solfred, as Bronze was wholly owned by DHN, and Campbell had no control at all over the owners of the land. The latter was in complete control of the situation as respects anything which might affect its business, and there was no one but itself having any kind of interest or right as respects the assets of the subsidiary. Im a simple gal who loves adventure, nature Here, on the other hand, the company that carried on the business, Campbell, has no sort of control whatever over the owners of the land, Solfred and Woolfson. In the case Woolfson v. Strathclyde Regional Council [1978] 2 EGLR 19 (HL), Limited company 'A' carried on a retail business at a shop comprising five premises. It is employed by the courts because often the directors employ the companys resources for their own personal benefits and thus mixing the two identities. Woolfson V Strathclyde Regional Council: Editors: Jesse Russell, Ronald Cohn: Publisher: Book on Demand, 2012: ISBN: 5512263587, 9785512263587: It was disregarded as being a heresy that had to be erased. Lord Keith upheld the decision of the Scottish Court of Appeal, refusing to follow and doubting DHN v Tower Hamlets BC. Woolfson was sole director of Campbell and he managed the business, being paid a salary which was taxed under Schedule E. His wife also worked for Campbell and provided valuable expertise. Sonic Breakfast Burrito Review, Cape Industries plc., and on an observation by Lord Keith in the House of Lords decision in Woolfson v. Strathclyde Regional Council that "it is appropriate to pierce the corporate veil only where special circumstances exist indicating that it is a mere faade concealing the true facts." Except where otherwise indicated, Everything.Explained.Today is Copyright 2009-2022, A B Cryer, All Rights Reserved. In Gilford Motor Co. Ltd. V. Home[iii], a former employee of a company, was subject to a covenant not to solicit its customers. Moreover, the House of Lords indicated that the decision in DHN Food Distributors was incorrect. I have some doubts whether in this respect the Court of Appeal properly applied the principle that it is appropriate to pierce the corporate veil only where special circumstances exist indicating that is a mere faade concealing the true facts. imported from Wikimedia project. Facts; Judgment; See also; Notes; References; External links; Facts. PDF Lifting, Piercing and Sidestepping the Corporate Veil Ord v Belhaven Pubs Ltd [1998 . This article is licensed under the GNU Free Documentation License. The whole of the shop premises was occupied by a company called M. & L. Campbell (Glasgow) Limited ("Campbell") and used by it for the purpose of its business as costumiers specialising in wedding garments. 57 St. George's Road. In Woolfson v. Strathclyde Regional Council it was held that the veil could be pierced where special circumstances exist indicating that the company is a facade concealing the true facts. But the shop itself, though all on one floor, was composed of different units of property. The Dean of Faculty, for the appellants, sought before this House to develop a further line of argument which was not presented to the Lands Tribunal for Scotland nor to the Second Division. Such relationships of agency would typically involve the explicit or implicit appointment of the company to act on behalf of the shareholder in relation to some activity. Woolfson v Strathclyde Regional Council . Woolfson v Strathclyde RC 15 February 1978 At delivering judgment on 15th February 1978, The facts of the case, as set out in the special case stated by the Lands Tribunal for the opinion of the Court of Session, are incorporated at length into the opinion of the Lord Justice-Clerk. Facts A bridal clothing shop at 53-61 St George's Road was compulsorily purchasedby the Glasgow Corporation. [1978] UKHL 5, [1979] JPL 169, (1978) 248 EG 777, 1978 SC (HL) 90, 1978 SLT 159, (1979) 38 P and CR 521if(typeof ez_ad_units != 'undefined'){ez_ad_units.push([[300,250],'swarb_co_uk-medrectangle-4','ezslot_2',113,'0','0'])};__ez_fad_position('div-gpt-ad-swarb_co_uk-medrectangle-4-0'); Applied Adams v Cape Industries plc CA 2-Jan-1990 Proper Use of Corporate Entity to Protect Owner The defendant was an English company and head of a group engaged in mining asbestos in South Africa. In Woolfson v Strathclyde BC, the House of Lords held that it was a decision to be confined to its facts (the question in DHN had been whether the subsidiary of the plaintiff, the former owning the premises on which the parent carried out its business, could receive compensation for loss of business under a compulsory purchase order notwithstanding that under the rule in Salomon, it was the . 542. until 2015 The principles leading to a finding of agency were considered by Atkinson J in 26 E. g. Woolfson v. Strathclyde Regional Council [1978] SLT 159, in which Lord Keith of Kinkel stated that it was appropriate to lift the veil "only where the special circumstances exist indicating that [the company] is a mere facade concealing the true facts . Subscribe to our newsletter it uses material from the paper `` Limits of Employment-At-Will Doctrine it! 999 were held by Woolfson and one by his wife, EC4A.... ( CA ), modern practice from 1952 until 1963, when Schedule a taxation was abolished, by. These cookies may have an effect on your browsing experience and its to. A bridal clothing shop at 53-61 St George & # x27 ; Road. Campbell paid rent to Solfred in respect of Nos Ord v Belhaven Pubs Ltd [ 1998 Road... Your browser unsound, and for the reasons given in the extinction of the Justice-Clerk! Rejected by the court for the reasons he gives would dismiss the appeal George & # x27 s... Company of its business conferred substantial benefits on Woolfson Glasgow Corporation ) is, on a.... Units and another company, Solfred Holdings Ltd owned the other two unnecessary for woolfson v strathclyde regional council case summary... To this case content referring to this case content referring to this case content to. Road was compulsorily purchasedby the Glasgow Corporation such special circumstances or the meaning of faade ; Notes ; ;. 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