separate legal entity

GIVE TERMS OF SECTION 20(1) of ca 2016

a company under this act is a body corporate that shall have 1) legal personality separate from its member and 2) continue exist in the company untill removed by registrar

explain doctrine of separate legal entity

establishes when company incorparated, it becomes separate legal enntity distinct from shareholders, directors and employees. in legal term company is a ‘person’ that can sue or be sued, incur debt, purchase property in its name,

section 191(1) of ca2016

provides that members is not liable for company’s obligation merely because of being a member.

salomon v. salomon

this case establise rules that comp and owner is separate legal entity , meaning that company treated as a diff person from its shareholders.

section 65 (1) of ca2016

a contract or transaction has been made on behalf of company before establishment is treated as being msde by person acting on behalf of the company, and the person will be personally liable for the contract or transaction.

section 65(2) of ca2016

by reffering to subsection, the company may be ratified contract after incorporation . the comp shall be bound by the contract or transaction as if the copmny exist on the date of contract and had been a party to contract or transac,

case ahmad bin salleh & ors vs Rawang Hill Resort sdn bhd

court held to dismiss plaintiff claimed and allow defendandt to counterclaims which includes, first purchase sales agreement, the defendant were not exist, also plaintiff were estopped from raising this issue untill the next trial and accept defendant as legal entoty in the first sales and purcjase transaction/agreement

separate legal entity ( section 540 and 593(3))

court may lift corporate veil and hold them personally liable

salomon vs salomon & co ltd

in this case company and owner is separate legal person meaning company and its shareholders will be treated distinct.