Question 1. Although Ali's company is a separate legal entity, the company is of course responsible of its actions and debts. Known as veil of incorporation. However this veil can be pierced, making the participants responsible liable for their actions. In this case, we can see that Ali has created a companyto defeat contractual obligations and this is evident has he had created the company before he had left the original company that he was working for. The case of Jones vs Lipman is a prime example of how this can be related. In this case, Lipman has entered a contract to sell his land. However he quickly changed his mind and to avoid completing the transaction, he transferred the land into a company that he had controlled. However it was held that the company was used as a device to avoid lipmans contractual obligations. Piercing the veil, and making the people responsible behind closed doors. II) Here we can see that the company is in breach of general law. We can see that had been selling illegal drugs. A prime example is