Business Law of Directing Mind and Will †MyAssignmenthelp.com

Question: Discuss about the Business Law of Directing Mind and Will. Answer: Directing mind and will According to the corporations law, when a particular person is related with the company, the conduct of such person can be considered as the conduct of the company if the person can be conceded as the directing mind and will of the corporation. After considering the facts of each case, it can be concluded that the person is the directing mind and will of the corporation (Hansmann, Kraakman and Squire, 2006). Hence, it cannot be inferred only due to the fact that a particular person is acting as the director of the corporation, data person is the directing mind and will of such company. The principle of directing mind and will has been incorporated in the Australian corporations law. In such cases, it can be considered that natural person is an embodiment of the company. This has been followed by the High Court in a number of cases where it has adopted the reasoning of Lord Reid that was applied by the court in Tesco Supermarkets Ltd. v Nattras (1971). Under the circumstances, it is c lear that a person acting at a senior position in the corporation can be described as the directing mind and will commence a person has the authority to perform as directed and in the interests of the corporation, the authority has been conferred on a person by the board of directors. For the purpose of identifying the directing mind and billing case of a particular corporation, it is necessary that the person taking care of the management and control concerning the act in question should be identified (Dewey, 1926). Piercing the corporate veil: A major advantage that is available in case of the entire duration of the company is related with the limited liability of its shareholders. However, in certain circumstances, it is available to the courts to ignore the separate legal identity of the corporation and hold the shareholders or the directors personally liable. Such a case is referred to as pacing the corporate veil or lifting the corporate veil. Generally, this method is used to walk towards the liability of the shareholders regarding the acts of the company (Lederman, 2000). Therefore it can be said that in case of lifting the corporate veil, the courts are allowed by thelaw to ignore the separate legal identity of the corporation. Therefore in such cases, the directors of the shareholders of a particular company can be held personally responsible for the debts and other obligations of the corporation. But at this point it needs to be noted that a strong presumption exists against the piercing the corporate veil. As a r esult, generally the courts are reluctant to pierce the corporate veil. Hence the courts are ready to pierce the corporate veil only where serious misconduct has been, for instance, if there is the abuse of corporate form (Gobert, 1994). In case of piercing the corporate veil, the court arrives at the decision where the rights and duties of the company will be treated as the obligations and rights of its members. Generally, due to the reason that a company is treated as having its own legal identity,, only the company is liable for its debts and obligations. However, there are certain exceptional circumstances where it may be decided by the courts that the principle of separate identity should be loaded and the corporate veil should be lifted. References Gobert, J. (1994) Corporate Criminality: Four Models of Fault, 14 Legal Studies 393 Hansmann, H., Kraakman R and Squire, R., (2006) 'Law and the Rise of the Firm', 119 Harvard Law Review 1333 Lederman, E. (2000) Models for imposing corporate criminal liability: from adaptation and imitation toward aggregation and the search for self-identity, 4 Buffalo Criminal Law Review 641 Dewey, J., (1926) 'The Historic Background of Corporate Legal Personality' 35 Yale Law Journal 655 Tesco Supermarkets Ltd v Nattrass [1971] UKHL 1