MGSC30H3 Study Guide - Midterm Guide: Limited Liability, Qualified Privilege, Ned Flanders
Document Summary
Indoor management rule: corporation is bound when its employees/agents act in a way that seems regular even if it"s not. Is a natural person but only applies to powers of contract and ownership. Don"t conduct business like a natural person: exclusive profit motive, relationship to risk, decision making cannot be truly defused within the whole, problem of short term management incentives (control for 4 years then change) Natural person: actual person, owns self, full contractual capacity, full rights protection at law, dies natural death. Legal person: creation of a statute, subject to state for existence, owned by investors, full contractual capacity (through agents, some rights protection at law, dies at wind-up or dissolution. Limited liability: must be signalled in name. Lifting the corporate veil : courts typically very reluctant, shareholder must control the corporation, control must be exercised to commit fraud, tort, or breach of duty, misconduct must cause injury complained of.