Critically evaluate, with reference to relevant case law and statute, how far this statement accurately reflects the current law relating to lifting the veil of incorporation for instance, in gilford motor co v horne the defendant was a former director of a company who signed an agreement that he would not solicit his former. Gilford motor co ltd v horne  ch 935 is a uk company law case concerning piercing the corporate veil it gives an example of when courts will treat shareholders and a company as one, in a situation where a company is used as an instrument of fraud. Gramophone & typewriter ltd v stanley  2 kb 89 re f g(films) limited [ 1953] 1 wlr 483 - tax case southern v watson  3 all er 439 rainham chemical works ltd v belvedere fish guano co ltd  2 ac 465 (ii) fraud/ facade gilford motor co v horne  ch 935 jones v lipman  1 wlr 832. In cases of fraud or sham these occur where individuals have used the separate legal entity to do something they are personally forbidden from doing gilford motor co ltd v horne (1933): h was a car salesman, and left g his contract stated that he wasn't allowed to sell to g's customers for a period after leaving h set up.
Wisdom of salomon courts rarely lift the veil between a company and its owners and directors, whatever the justice of the case james mendelsohn outlines when limited exceptions to the rule are made treated as one in gilford motor co ltd v horne  ch 935 (ca) james mendelsohn teaches company law at. Piercing doctrines under us corporation and english company law the article highlights some fundamental provide a more systematic approach to veil piercing cases involving corpo- rate groups introduction cases in the first half of the twentieth century included gilford motor v horne,45 in re. Piercing the corporate veil refers to looking at the individual natural persons acting as agents involved in a company action or decision this may result in a legal decision in which the rights or duties of a corporation or public limited company are treated as the rights or liabilities of that corporation's members or directors.
The two classic cases of the fraud exception are gilford motor company ltd v horne and jones v lipman in the first case, mr horne was an ex-employee of the gilford motor company and his employment contract provided that he could not solicit the customers of the company in order to defeat this, he incorporated a. It is well recognised that the courts will intervene where a company is used primarily as a vehicle of fraud or as a means of escaping pre-existing legal obligations in gilford motor company ltd v horne,3 mr horne had been the managing director of the claimant company and was subject to a non-compete covenant in his. The third ground for veil lifting identified in adams is where a company is a mere façade or sham, or is being used to perpetrate a fraud this reflects earlier cases such as gilford motor co v horne  it's not entirely clear what renders a company a mere façade, or its use fraudulent adams suggests, however, that it. In lonrho ltd v shell petroleum co ltd  1 wlr 627 the house of lords ( 2) section 24 of the matrimonial causes act might be regarded as conferring a distinct power to disregard the corporate veil in matrimonial cases the first and most famous of them is gilford motor co ltd v horne [1933.
Gilford motor co ltd v horne: ca 1933 of course, in law the defendant company is a separate entity from the defendant horne but i cannot help feeling quite convinced that at any rate one of the reasons for the creation of the company was the fear of horne that he might commit this case is cited by. The separate legal principle in salomon as the “unyielding rock” on which company law is constructed, and on gilford motor co ltd v horne is a prime example of a one person company being a sham or 27 new zealand also has the land transfer act 1952 so it is unlikely that a case with the same facts as jones would.
John wilson qc of 1 hare court analyses the supreme court's judgment in the landmark case of prest v petrodel and considers its implications for family lawyers on lord sumption's analysis in gilford motor co v horne relief was granted against mr horne on the concealment principle and against his. Corporations law case concerning separate legal identity and penetrating the corporate veil under the exception of 'using the company as a vehicle for fraud the principle refers to use of the company by its controllers in an attempt to avoid an existing legal duty that otherwise falls on the controller personally where this. Concept of lifting of corporate veil, case studies and exceptions law will lift the corporate veil under statutory provisions/exceptions under judicial interpretation/exceptions 7 under case: gilford motor co v horne f: h was employed as a managing director in the p's company.
At the law in relation to lifting and piercing following the recent decision of the supreme court in prest v the developments in the case law, including the debate about whether a power to pierce the corporate veil truly have been pierced (gilford motor co ltd v horne  ch 935, jones v lipman  1 wlr 832. The courts may pierce the corporate veil and remove the protection of the salomon principle to prohibit fraud this was evident in gilford motor co ltd v horne where a managing director agreed not to engage with his former employer's customers but proceeded to do so through a newly formed company.
This case is now before the supreme court there is no doubt that this is a difficult issue as to which there is more than one reasonable view the strongest argument in favour of the appellants in vtb capital appears to be the reasoning in gilford motor co v horne the strongest argument to the contrary is. The best known of these cases is gilford motor co ltd v horne  ch 935 it is the evasion principle which may justify the court piercing the corporate veil it applies where a person is under an existing legal obligation or liability or subject to an existing legal restriction which he deliberately evades or. He set up a limited company with his wife as director, and sought through that company to poach clients of gilford motor company mr eyre, who argued this case with great skill on behalf of the acquiring authority, relied on horn v sunderland corporation  2 kb 26, and he said that compensation. This principle derives from the observation from lord macnaghten in salomon v a salomon & co ltd that a 'company is at law a different person this was the case in both gilford and jones both mr horne and mr lipman attempted to avoid liability for their own wrongdoing by using a company that they.