Assignment One Answer
Material facts:
Wendy Shockett recently closed her business, ceased to trading, but her business not in receivership and liquidation, and has not been removed from the Companies Register.
There are two shareholders in the company. Mile who is Wendy's husband hold two shares. Wendy Shockett, who is the sole director of the company hold rest of the shares.
Wendy lodged an application with Work and Income for a means tested benefit after closed her business. The application has been declined because there are two bank accounts that belonging to the company has assets exceeded the statutory limit.
There is the corporate veil separates a company from its shareholders. Lift the corporate veil will make shareholder personal liable, which means the assets exceed the statutory limit. She is not entitled to the benefit.
Legal Issues
Who own the funds in two bank accounts?
Can the corporate veil be lifted?
Relevant Statute and case law
S 15 Companies Act 1993 states the company has separate legal personality - a company is a legal entity in its own right separate from its shareholders and continues in existence until it is removed from the New Zealand register.
Whitechapel High Street, where Aron Salomon, the m...
A bond from the Dutch East India Company, dating f...
WendyCase: Salomon v Salomon and Co Ltd [1897]
Lee v Lee's Air Farming Ltd [1961]
R v McCurdy [1983]
Re Grasslands Farms Ltd [1975]
Coleman v Myers [1977]
Re Securitibank Ltd (No.2) [1978]
Savill v Chase Holdings (Wellington) Ltd
Chen v Butterfield (1996)
Official Assignee v 15 Insoll Avenue Ltd [2001]
Preston v International Direct Ltd
Applications:
The business has been closed and ceased to trading, but the business not in receivership and liquidation, the most important thing is the company has not been removed from the Companies Register, which means the company not completely ceased from the market, it still exists.