lifting the veil of incorporation

Ddeadlybeauty514y ago

hi, i am not understanding the Daimler v Continental tyre case law.
what is the matter here? the defendant is a UK company. and who is the claimant? pls make me understand the whole thing. who owes debt and who is claiming the debt and the held was against whom?

Mmonica78614y ago#1

Hi,

Yes - I found this quite weird at first but this is how I understand this now.

Daimler V Continental tyre and rubber = refers to the war time, where the law said it was illegal to trade with enemy companies i.e. Germany. Now initially C sued D because D owed them money.
Now, unfortunately for C's bad luck - D made an appeal against C saying the members of the company are german therefore if they give the money to him then that money will go towards germany's war efforts.

Held: D - not to give C the money owed. As it will be illegal to trade with the enemy.

Now, the reason why its a lifting of the veil of incorporation because it is looking at the members, not the company.

I hope this makes sense.

((deleted)13y ago#2

Hi, i had some issues here too
Did some Googling and sort it out, this is what helped;

This case was decided during the time when England was at war with Germany.
Continental sued Daimler for money due in respect of goods supplied. Daimler claimed that the Company was actually owned by German Nationals and paying them was illegal under the Trading with the Enemy Act.

The Court lifted the Corporate veil to discover if this was so, and found as a fact that it was the Germans who were operating the business. D was therefore successful in its defence.