THE VEIL OF INCORPORATION: TO DISLODGE OR NOT TO DISLODGE?

Abstract

The principle of separate personality provides that in law the company is viewed as a person with distinct personality from its members. Consequently, the creditors of the company are required to sue the company as a person instead of its members. However, to avoid injustice through a consistent application of the separate personality principle, some exceptions have been established and construed into what is known as the doctrine of piercing the veil. This essay concerns a critical examination of the doctrine of lifting the veil and points out the weaknesses of the judicial authorities proposing them. It is concluded that in as much as these case laws remain the existing authorities in this area, their pitfalls notwithstanding, they at least require codification to achieve certainty and precision in applying the law.