Theories of Corporate Personality Essay

4404 Words 18 Pages
Theories of Corporate Personality

MANAS AGARWAL
5th Semester BA LL.B (B)
School of Law
Christ University
Bangalore

INDEX

* Research Methodology * Introduction * The Common Law Perspectives * Fiction Theory * Concession Theory * The Purpose Theory * Bracket Theory * Realist Theory * Why Corporations? * Corporate Personality And Limited Liability
Cases:
* Macaura v. Northern Assurance Co. * Lee v. Lee’s Air Farming * Salomon v. Salomon & Co.
ACKNOWLEDGEMENT

I Manas Agarwal of B.A.LL.B (Hons.) is really grateful to Ms. Fincy V, without whose help and corporation this project would not have been possible. I am also grateful to the National Law School India University
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The acceptance of the corporate personality of a company basically means that another non-human entity is recognized to assume a legal entity. This can be seen from the many theories of jurisprudence on corporate personality. Majority of the principal jurisprudence theories on corporate personality contended that the legal entity of the corporation is artificial. The fiction, concession, symbolist and purpose theories supported the contention that existence of corporation as a legal person is not real. It only exists because the law of the state recognized it as legal person and it is recognized either for certain purpose or objectives. The fiction theory, for example, clearly stated that the existence of corporation as a legal person is purely fiction and that the rights attached to it totally depend on how much the law imputes upon it by fiction.

The Common Law Perspectives

Generally, there are two types of person which the law recognized, namely the natural and artificial person. The former is confined merely for human beings while the latter is generally referred to any being other than human being which the law recognized as having duties and rights . One of the most recognized artificial persons is the corporation.

Legal scholars, particularly the jurists, have always explored the issue on the recognition of corporation as a legal person. In the study of jurisprudence, the separate legal personality of corporation is based upon theories, which

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