BLAW 3100 Chapter Notes - Chapter 11: Legal Personality, Mark Zuckerberg, Vicarious Liability

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27 Dec 2018
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Incorporation creates a separate legal entity, that has a legal personality separate from the people who own shares in it. Shareholders can be continually changing, while the company itself remains intact. An owner owns shares that can be bought and sold. Mark zuckerberg owns shares in facebook-- can sell his shares whenever he wants to. Shareholders do not actually own the assets of the business. Courts may lift corporate veil to get at managers who commit crimes or avoid regulations. Allows for acquisition of capital without involving shareholders in operation of corporation. Allows purchase and sale of corporation"s shares without interfering with ongoing operation of business. Limits liability of shareholders -- limited to the amount they paid for the shares. All activities of a corporation are carried out by agents. Filed documents no longer count as notice of limited authority: describe the advantages and disadvantages of incorporation. Unless directors/officers give personal guarantees for loans.

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