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- Title
Disregarding the Salomon Principle: An Empirical Analysis, 1885–2014.
- Authors
Dignam, Alan; Oh, Peter B
- Abstract
For over a century UK courts have struggled to negotiate a coherent approach to the circumstances in which the Salomon principle –that a corporation is a separate legal entity–will be disregarded. Empirical analysis can facilitate our understanding of this mercurial area of the law. Examining UK cases from 1885 to 2014, we created a final dataset of 213 cases coded for 15 different categories. Key findings confirm historical patterns of uncertainty and a low but overall fluctuating disregard rate, declining recently. Criminal/fraud/deception claims link strongly to disregard outcomes. Private law rates are low but tort claims have a higher disregard rate than contract. Individual shareholders are more susceptible to disregard than corporate shareholders. The English Court of Appeal plays a key role in successful disregard claims particularly in tort. In general, while disregard rates were very context specific, concerns about the diminished sanctity of the Salomon principle may be overblown.
- Subjects
UNITED Kingdom; CORPORATION law; BRITISH law; APPELLATE courts; DECISION making in law
- Publication
Oxford Journal of Legal Studies, 2019, Vol 39, Issue 1, p16
- ISSN
0143-6503
- Publication type
Article
- DOI
10.1093/ojls/gqy027