Corporate Personality in the 20th Century. Edited by CHARLES E. F. RICKETT and ROSS B. GRANTHAM

Transcription

1 Corporate Personality in the 20th Century Edited by CHARLES E. F. RICKETT and ROSS B. GRANTHAM HART- PUBLISHING OXFORD 1998

2 Contents List of Tables Table of Cases Table of Legislation xiii xv xxii 1 The Bootmaker's Legacy to Company Law Doctrine 1 Ross Grantham and Charles Rickett I. The Victorian Company 1 II. The New Age 4 <2 Corporate Personality Limited Recourse and its Limits 11 David Goddard I. The Point of Salomon v. A Salomon & Co. Ltd. Limited Recourse Works 11 II. The Limits of Limited Liability 17 III. Developments in the Last One Hundred Years 44 IV. Conclusions 63 3 Commentary on Goddard 65 Ross Grantham I. Limited Liability 65 II. Corporate Personality 67 4 Corporate Groups 71 Robert P. Austin I. Introduction 71 II. Inroads into Salomon's case 71 III. The Corporate Group Concept 72 IV. Reasons for the Wholly Owned Group Structure 73 V. Management Structures 74 VI. Financial Management 75 VII. The Tension Between Business Organisation and Corporate Structure 75 VIII. Group Liability to Voluntary (Contract) Creditors 76 IX. Qualification to the Separate Entity Doctrine 77 X. "Lifting the Corporate Veil" in the Corporate Group Context 78 XI. The Briggs Case 79 XII. The Uncertainty Argument 79 XIII. Law Versus Commercial Reality the Qintex Case 80 XIV. Creditor Expectations 81

3 x Contents XV. The Administration of Group Corporate Liquidations 82 XVI. "Pooled Liquidation" under Australian Law 82 XVII. The New Zealand Solution 84 XVIII. The Harmer Recommendations in Australia S6 XIX. An Exception for Financial Segregation 87 XX. Involuntary (Tort) Creditors 87 XXI. Parent Liability for Insolvent Trading 88 XXII. Conclusion 5 Commentary on Austin 91 Andrew Borrowdale I. Introduction 9* II. History of the New Zealand Legislation 92 III. Pooling Under the Companies Act 1993 (NZ) 94 IV. Contributions Under the Companies Act 1993 (NZ) 96 ^6 Corporate Personality, Limited Liability and the Protection of Creditors "" Dan Prentice I. Recovery from Creditors ^" II. Recovery from Shareholders W 1 III. Recovery from Directors 1^ IV. Enhancing the Pool of Assets Directors' Liability 108 V. Conclusion l2-> 7 Commentary on Prentice 12' Thomas G. W. Telfer I. Risk-taking and the Limited Liability Company 12 II. Uncompensated Risk and the Market 12" HI. The Impact of Director Liability & IV. Uncertainty and the Judicial Interpretation of Risk 13 V. The Interpretation of the New Zealand Companies Act 1993 I 40 VI. The Hypothetical Bargain I 46 VII. Conclusion I 47 8 Company Law and Regulatory Complexity I 4 " Joanna Gray I. Introduction l 4^ II. "Officer Liability" Provisions and the Decision in Re Attorney-General's Reference (No 1 of 1995) 15* III. Recent Trends in Corporate Regulatory and Criminal Responsibility 159 IV. Conclusion I6 7 89

4 Contents xi 9 Commentary on Gray 169 Bernard Robertson I. Should There be a General Defence of Ignorance of the Law? 169 II. Should There be a Narrower Defence? 171 III. What does This Tell Us about the Rationale for Corporate Liability? 172 IV. What are the Practical Effects? Changes in the Role of the Shareholder 175 Jennifer Hill I. Introduction 175 II. Visions and Revisions of the Shareholder 177 III. Visions of the Shareholder in Recent Australian Corporate Law Developments 195 IV. Conclusion Commentary on Hill 209 Robert P. Austin I. The Shareholder as Owner/Principal 209 II. The Shareholder as Beneficiary 210 III. The Shareholder as Bystander 210 IV. Shareholders as Participants in a Political Entity 211 V. The Shareholder as Investor 211 VI. The Shareholder as Cerberus 212 VII. The Institutional Shareholder as Managerial Partner 213 VIII. Conclusion Models of Corporate Regulation: The Mandatory/Enabling Debate 215 Ian M. Ramsay I. Introduction 215 II. Corporate Regulation: The Mandatory/Enabling Debate 218 III. The Costs of Mandatory Rules 238 IV. Mandatory Corporate Disclosure Rules: A Case Study 243 V. Limited Liability: A Second Case Study 249 VI. Some Implications of Institutional Investment and Electronic Commerce for Mandatory Rules 265 VII. Conclusion Commentary on Ramsay 271 Tint Hazledine 14 Financial Transparency and Corporate Governance: The United States as a Model? 279 Louis Lowenstein I. Three Elements of Shareholder Oversight 279

5 xii Contents II. The German and Japanese Structures are Intuitively Sensible 280 III. The United States Model Seems to be Inferior, Yet it Works 281 IV. The American Mandated Disclosure System is a Cornerstone 281 V. The Corporate Chieftains Manage What We Measure 282 VI. How Good is American Accounting? 284 VII. The Process by Which the Pressure is Applied 288 VIII. Drawbacks of the American System 288 IX. An International Perspective 289 X. Conclusion 291 Index 293