I am having a problem understanding the case and its relation to piercing the corporate veil. Can I get an explanation please

Thank u
Shannypooh

Daimler Co Ltd v Continental Tyre and Rubber (GB) Ltd (1916)
C sued D for debts owing. C was a UK company; however all
Shareholders but one) were German. D argued that they should not pay
The debt to German individuals to prevent money going towards
Germany's war effort. The court held that C was German.

I wish to reproduce from the study text prepared by BPP.

In time of war it is not permitted to trade with 'enemy aliens'. The courts may draw aside the veil if, despite a company being registered in the United Kingdom, it is suspected that it is controlled by the aliens. The court may then determine the owners' nationality.

The facts are correctly stated by jasniya. However, the court held that the plaintiff "D need not discharge a debt to the defendants since the effective control of the latter "C" was in enemy hands and hence to do so would be to trade with the enemy.

Lifting of the corporate veil basically occurs when the courts refuse to looks at the technical aspects of the case in relation to the laws of the land but look at the real facts of the matter by going beyond the corporate veil to look at those who constitute the company i.e. members and Directors.

Helpful

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Originally Posted by pbschand

helpful

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Really? Helpful even if incorrect? The post dated Dec 10, 2010 is not exactly accurate. It's not that limited liablility for owners of a company is a "technical aspects of the case in relation to the laws of the land", it is the law of the land. :)

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Originally Posted by pbschand

helpful

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Don't take legal advice from people who can barely spell and definitely can't use punctuation.