Question
In Lees case the court found that Salomons case does not promote a separation of entity where the director is also the employee, and in
In Lees case the court found that Salomons case does not promote a separation of entity where the director is also the employee, and in fact owns 99% of the shares, the company was created purely to claim on insurance and was a sham | ||
The case was important because it was one of the first modern cases to affirm the separation of entity for a company, even where a director was also an employee | ||
A shareholder can be a director of a company, but cannot have a contractual relationship if the separation of entity is to be preserved | ||
The widow of a deceased worker was unable to claim against the company because she was not a member of the company and the company was a separate legal entity for insurance purposes |
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