Macaura v Northern Assurance Co Ltd [1925] AC 619 appeared before the House Of Lords concerning the principle of lifting the corporate veil. Unusually, the request to do so was in this case made by the corporation's owner.
Video Macaura v Northern Assurance Co Ltd
Facts
Mr Macaura owned the Killymoon estate in County Tyrone, Northern Ireland. He sold the timber there to Irish Canadian Sawmills Ltd for 42,000 fully paid up £1 shares, making him the whole owner (with nominees). Mr Macaura was also an unsecured creditor for £19,000. He got insurance policies - but in his own name, not the company's - with Northern Assurance covering for fire. Two weeks later, there was a fire. Northern Assurance refused to pay up because the timber was owned by the company, and that because the company was a separate legal entity, it did not need to pay Mr Macaura any money.
Maps Macaura v Northern Assurance Co Ltd
Judgment
The House of Lords held insurers were not liable on the contract, since the timber that perished in the fire did not belong to Mr Macaura, who held the insurance policy. Lord Buckmaster gave the first judgment, holding in favour of the insurance companies. Lord Atkinson concurred. Lord Sumner concurred and said the following.
Lord Wrenbury and Phillimore concurred.
See also
- Kosmopoulos v Constitution Insurance Co of Canada [1987] 1 SCR 2
- Attorney General of Belize v Belize Telecom Ltd
- JJ Harison (Properties) Ltd v Harrison [2001] EWCA Civ 1467, said there is no company law rule which says the company is a trustee and the shareholders the beneficiaries.
- Lee v Lee's Air Farming [1961] AC 12
Notes
Source of the article : Wikipedia
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