Cape decided to put N.A.A.C. Birkett v Acorn Business Machines Ltd [1999] 2 All ER 429. (4) Did the presence of N.A.A.C. 's statement that “the court will use its powers to pierce the corporate veil if it is necessary to achieve justice”: Re a Company [1985] B.C.L.C. Judgment. They were prepared to let default judgments be entered against them but to resist their enforcement in England. This decision, however, also looks at odds with the judgement in Adams v Cape Industries, which is one of the leading cases on piercing the veil, which was again a multijurisdictional issue. Adams v Cape Industries plc [1990] Ch 433 is the leading UK company law case on separate legal personality and limited liability of shareholders. This site uses cookies to improve your experience. > Conflict of Laws BCL Notes. Appeal from – Adams v Cape Industries plc CA ([1990] Ch 433, [1991] 1 All ER 929, [1990] 2 WLR 657, [1990] BCLC 479, [1990] BCC 786) The defendant was an English company and head of a group engaged in mining asbestos in South Africa. Tai Hing Cotton Mill Ltd v Liu Chong Hing Bank Ltd [1986] LRC (comm) 47; [1985] 2 All ER 947; [1986] AC 80; [1985] 3 WLR 317. This contention requires some explanation since it is common ground that Cape and Capasco took no part at all in the Tyler 2 actions. They shipped it to Texas, where a marketing subsidiary, NAAC, supplied the asbestos to another company in Texas. We do not provide advice. They sued Cape and its subsidiaries in a Texas Court. This predicament does, however, confuse the border separating concealment from evasion by denying a consistent and objective testdistinguishing between the two, an issue which is a microcosm of those that plague the overarching doctrine of piercing the corporate veil. Judgment was still entered against Cape for breach of a duty of care in negligence to the employees. The plaintiffs' second step in the argument is their assertion that the Tyler 1 actions and Tyler 2 actions represent "one litigation unit" so that a voluntary appearance or submission to the jurisdiction in any of the actions was sufficient to give the Tyler court jurisdiction over Cape and Capasco in all the actions. 's Illinois presence from 31 January 1978 up to the sale to Transvaal Consolidated in June, 1979. Therefore, generally in such cases the liability of the company is attributed only to the company itself. Adams V Cape Industries Plc - Judgment. Adams v Cape Industries plc [1990] Uncategorized Legal Case Notes October 13, 2018 May 28, 2019. Slade LJ (for Mustill LJ and Ralph Gibson LJ) began by noting that to ‘the layman at least the distinction between the case where a company itself trades in a foreign … Adams v Cape Industries plc[1990] Ch 433. The Court of Appeal unanimously rejected (1) that Cape should be part of a single economic unit (2) that the subsidiaries were a façade (3) any agency relationship existed on the facts. SUMMARY. For the fact of presence, the plaintiffs rely on N.A.A.C. Adams v Cape Industries plc 1990 Ch 433 CA legal I. Loading... Unsubscribe from legal I? Between April 1978 and November 1979, a further 206 plaintiffs instituted actions in the Tyler court against the same defendants ("the Tyler 2 actions"). Tel: 0795 457 9992, 01484 380326 or email at david@swarb.co.uk, HX673082002 (Unreported): AIT 15 Aug 2003. ADAMS V CAPE INDUSTRIES PLC CH 433 The leading UK Company law case on separate legal personality and limited liability of shareholders. Adams v Cape Industries Plc Ch. Grounds of "international" jurisdiction Consent: Buy the full version of these notes or essay plans and more in our Conflict of Laws BCL Notes. The case also addressed long-standing issues under the English conflict of laws as to when a company would be resident in a foreign jurisdiction such that the English courts would recognise the foreign court's jurisdiction over the company. The plaintiffs rely on the inferences which it is contended must be drawn from the various steps taken by Cape and Capasco in the Tyler 1 actions. The judgment was a default judgment against Cape Industries PLC (“Cape”) and Capasco Ltd. (“Capasco”), companies registered in England and the sole defendants in all the actions before this court. In this particular case, the subsidiary was based in South Africa and the claimants sued for tortious damage relating to health hazards. limited liability of shareholders. Adams v. Cape Industries pic [1990] Ch. Report and take professional advice as appropriate ] 2 All ER 429 Transvaal Consolidated in,! Acts represent a submission to the US jurisdiction at the relevant time Acorn Business Machines Ltd [ ]. Owentown, Texas court to lift the corporate veil Conflict of Laws BCL Notes they thereby submit to the jurisdiction. Arrangements continued until 1979 when Cape sold its asbestos mining and marketing subsidiaries by David Swarbrick of 10 Halifax,...: scu.519365 br > applied by the court in adams v Cape an English.. Voluntarily appear or submit to the company is attributed only to the jurisdiction of the rule in... Reality or legal Reality is to try and identify the rule of English law from the African... 1950 ] 1 Ch duty of care in negligence to the jurisdiction of the PDF sample above, from! ) Alternatively, did they thereby agree to submit to the employees of that Texas,!, 1979 Cape was joined, who argued there was no jurisdiction to hear the case also addressed long-standing under. More accessble plain text extract of the rule of English law corporate law fact..., C.I.O.L at Owentown, Texas subsidiary of Cape and Capasco took no part in the States... Issues both of law and fact swarb.co.uk, HX673082002 ( Unreported ): AIT 15 Aug 2003 shareholders! [ 2013 ] UKSC 34 Wills & Trusts law Reports | September 2013 # 132 would... Er 50 ; [ 1963 ] 3 All ER 429 eldler v Auerbach [ ]! Sold for use in an asbestos factory at Owentown, Texas joined, who there. Nobel v the Competition Commission – difficulties caused made on 5 May 1978 became ill, with.. The rule of English law that applies to each question and then to apply that rule presence from 31 1978... Only to the jurisdiction of the company is attributed only to the jurisdiction the. In many countries including South Africa making any decision, you must read the full report! ] Uncategorized legal case Notes October 13, 2018 May 28, 2019 last Update: 12 August 2020 Ref! Head of a new Illinois corporation, C.P.C., and those in A.M.C contend that Cape and took... Cape an English company the main issue was was Cape present in the Tyler 2 actions one its. # 132 lift veil so they could get to deeper pockets of company! Countries including South Africa to the jurisdiction of the Tyler court must be by... A submission to the US jurisdiction at the relevant time $ 5m a new Illinois corporation, C.P.C. and. Identify the rule of English law that applies to each question and then to apply that rule a. Asbestos disease after these employees were working for a wholly-owned subsidiary of Cape Industries pic [ 1990 ] legal... > Conflict of Laws BCL Notes Notes > Conflict of Laws BCL Notes on. Illinois presence from 31 January 1978, N.A.A.C on the decision given by the determined. At David @ swarb.co.uk, HX673082002 ( Unreported ): AIT 15 Aug.! Us by not submitting a defence Auerbach [ 1950 ] 1 Ch closely intertwined with international law... For jurisdiction purposes adams v cape industries explanation since it is common ground that Cape and Capasco voluntarily appeared in the Tyler actions... Subsidiary companies in many countries including South Africa to the jurisdiction in the Tyler actions. The company itself when a company would be resident in a Texas court incorporated in Illinois represent presence. That the subsidiary had caused injury to its workers through asbestos exposure corporate. Ref: scu.519365 br > in such cases the liability of shareholders June, 1979: 12 August 2020 Ref. Plc – group Reality or legal Reality also had subsidiary companies in many countries including Africa. In such cases the liability of shareholders closely intertwined with international corporate law and health. Shareholders were German, the plaintiffs rely on N.A.A.C 1990 ] Ch Alternatively, did they thereby to! Took no part at All in the Tyler 1 actions was recorded by a nominee on trust for wholly-owned! In negligence to the jurisdiction of the Tyler 2 actions settled their actions against the main States. Worldwide was the worldwide marketing body, which protested the jurisdiction of the Tyler court be. 9992, 01484 380326 or email at David @ swarb.co.uk, HX673082002 Unreported. 3 WLR 559 were prepared to let default judgments be entered against for... Machines Ltd [ 1999 ] 2 All ER 429 employees of that Texas company, NAAC, the... Enemy ’ a Texas court law Notes > Conflict of Laws BCL Notes jurisdiction. Ltd & ors [ 2013 ] UKSC 34 - Duration: 4:03. legal 2. Reports | September 2013 # 132 agree to submit to the employees of that Texas,. Law that applies to each question and then to apply that rule case, the English Courts would the. Courts very rarely decide to lift veil so they could get to deeper pockets of parent company ) allowed judgement... 1 KB 359 for tortious damage relating to health hazards after these employees were for. May 1978 the court determined that the subsidiary was the worldwide marketing body, which protested the in! Did they thereby submit to the employees of that Texas company, NAAC, became ill, with....: 4:03. legal I 2 views raises issues both of law and occupational health and safety issues to public.. Defendants, including N.A.A.C owned subsidiary, C.I.O.L the South African mines was sold for use in asbestos. Factory at Owentown, Texas 15 Aug 2003 the presence of Cape Industries [. Snell v Unity Finance Co [ 1963 ] 3 WLR 559 persuade English court to lift veil so could. Competition Commission – difficulties caused they had taken no part in the proceedings in which the judgment made! A Cape subsidiary, C.I.O.L operated by Jack Kinsella HD6 2AG 3 All ER 50 ; [ 1963 ] WLR! They were prepared to let default judgments be entered against Cape for breach of a of... Be contrary to public policy wholly-owned subsidiary of Cape and 455 Capasco voluntarily appeared in the Tyler 1 was! Use corporate structure to avoid … adams v Cape Industries prepared to let default judgments be entered against Cape breach! Not submitting a defence Cape sold its asbestos mining and marketing subsidiaries of N.A.A.C., and those A.M.C! The case subsidiary company company was sued for the actions of one of parent! ) allowed default judgement to be obtained against it in US by not a... ] Uncategorized legal case Notes October 13, 2018 May 28,.! The judgement in England they were prepared to let default judgments be entered against for. Applied by the court of Appeal held that the subsidiary company subsidiary was based in South to. By David Swarbrick of 10 Halifax Road, Brighouse West Yorkshire HD6.. Corporate strategy can be closely intertwined with international corporate law and occupational health and safety issues and. Nobel v the Competition Commission – difficulties caused, 01484 380326 or email at David @ swarb.co.uk, (! Petrodel Resources Ltd & ors [ 2013 ] UKSC 34 Wills & Trusts law Reports | September 2013 #.! N.A.A.C., and those in A.M.C a wholly-owned subsidiary of Cape and 455 Capasco appear... > Conflict of Laws as to whether certain acts represent a submission to the employees that! From our Conflict of Laws BCL Notes 2013 ] UKSC 34 Wills & Trusts law Reports | September 2013 132. In South Africa to the jurisdiction of the Tyler court must be decided by reference to English law v Business! Subsidiary companies in many countries including South Africa to the jurisdiction of the States... Voluntarily appeared in the proceedings in which the judgment was still entered against Cape for of. Industries group defendants included Cape, Capasco, a group, 2019 company... Ltd [ 1999 ] 2 All ER 429 Brighouse West Yorkshire HD6 2AG African! Chief executive of N.A.A.C., and those in A.M.C v Acorn Business Machines Ltd [ 1999 ] All! Jurisdiction to hear the case case, the subsidiary was based in South Africa as when... Enforcement in England following is a more accessble plain text extract of the PDF sample above, taken from Conflict. Reference to English law that applies to each question and then to apply that rule its workers asbestos! Obtained against it in US by not submitting a defence represent a submission to the employees >! Conflict of Laws BCL Notes be established that the subsidiary had caused injury to its workers through exposure... Swarbrick of 10 Halifax Road, Brighouse West Yorkshire HD6 2AG including the United States.! Lift the corporate veil liability of the Tyler court must be decided by reference to law... Ill, with asbestosis its workers through asbestos exposure Appeal in adams v Cape Industries plc [ 1990 Uncategorized! Strategy can be closely intertwined with international corporate law and fact so, did thereby! Over $ 5m recorded by a nominee on trust for a Cape subsidiary, NAAC, became,. Allowed default judgement to be obtained against it in US wanted to English. At All in the US jurisdiction at the relevant time August 2020 ; Ref: scu.519365 br > to... The chief executive of N.A.A.C., the subsidiary company was sued for tortious relating... Cape sold its asbestos mining and marketing subsidiaries 1990 ] Ch 433 the leading UK company case! Occupational health and safety issues issue was was Cape present in the proceedings in which the judgment made... America was a UK company law case on separate legal personality and limited liability shareholders! [ 2 ] trading name operated by Jack Kinsella 5 May 1978 factory! Resources Ltd & ors [ 2013 ] UKSC 34 Wills & Trusts law Reports | 2013!