Mr. Boss was the major shareholder and a director of Housing Construction Limited, a private limited company specializing in middle to low income housing development. Mr. Boss worked for the company as the Structural Engineer for over one year and received a salary for that position. His wife Mrs. Boss and his sister Rosey were minority shareholders in the company. While working on a construction site there was a major landslide and Mr. Boss was killed by fallen rocks, his wife, being the only beneficiary, claimed on a worker’s compensation insurance policy that the company had taken out with the General Insurance Limited naming Mr. Palmer as an employee. (The Case of Lee v. Lee’s Air Farming Ltd [1960].)

Mrs. Boss Had also insured all the company equipment with the same insurance company against fire, but in her own name. General Insurance Limited has denied Liability on both grounds, stating that Mr. Boss could not be an employee because he was the major shareholders and director of the company. In addition General Insurance Limited has indicated that the claim for compensation for the equipment destroyed by fire was not valid, hence it was not liable to pay. Mrs. Boss is furious and has threatened to take legal action. (The Case of Macaura v Northern Life Assurance Company Ltd [1925].)

Prior to incorporation of Housing Construction Limited, Rosey had purchased two delivery trucks at a cost of $2 M each to be used in the business. Upon incorporation of the company, she sold the delivery trucks to the company for $3M each. Rosey did Not Inform Mr. and Mrs. Boss that she purchased the delivery trucks two weeks before the company was incorporated. Mrs. Boss has recently discovered the facts about the delivery trucks and is contemplating seeking legal advice.( The Case of

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