a) Sarah married John in 2000. By 2009, Sarah had decided that she no
longer loved John, and might well divorce him in the future. In 2010,
Sarah inherited an office block in London worth £50 million. She
immediately transferred both her legal and her beneficial interest in
the office block to a company, Hidem Ltd. Sarah had formed Hidem in
1999 but it had never traded. It had issued one share, owned by
Sarah’s sister, Belinda. Belinda was also the only director of Hidem.
In March 2016, Sarah finally began divorce proceedings against John,
and John now wishes to claim financial relief from Sarah.
Assume that the amount of financial relief will depend on Sarah’s
wealth. Advise John whether, as a matter of company law, he will be
permitted to lift the corporate veil and treat Sarah as if she still owned
the office block.
b) Desparate Ltd has been trading at a loss for many months. It has
one director, Ollie. In January 2016, Ollie persuaded George to lend
£50,000 to Desparate. Ollie tells George: ‘Don’t worry about getting
your money back. I personally promise that Desparate is financially
secure’. In April 2016, winding-up proceedings are begun against
Desparate. Its liabilities massively exceed its assets. George has
not been paid.
Advise Ollie whether he will be liable:
(a) personally to George; and
(b) to contribute to the assets of the company.
2011 Zone B Question#6
The question required us to advise Niall, Sabrina’s former husband with regards
to whether he can bring a derivative claim against Sabrina on behalf of Citadel Ltd
of which she is the managing director. In order to ascertain whether the Court will
allow proceedings for such a claim, it is essential to assess the rules pertaining to
longer loved John, and might well divorce him in the future. In 2010,
Sarah inherited an office block in London worth £50 million. She
immediately transferred both her legal and her beneficial interest in
the office block to a company, Hidem Ltd. Sarah had formed Hidem in
1999 but it had never traded. It had issued one share, owned by
Sarah’s sister, Belinda. Belinda was also the only director of Hidem.
In March 2016, Sarah finally began divorce proceedings against John,
and John now wishes to claim financial relief from Sarah.
Assume that the amount of financial relief will depend on Sarah’s
wealth. Advise John whether, as a matter of company law, he will be
permitted to lift the corporate veil and treat Sarah as if she still owned
the office block.
b) Desparate Ltd has been trading at a loss for many months. It has
one director, Ollie. In January 2016, Ollie persuaded George to lend
£50,000 to Desparate. Ollie tells George: ‘Don’t worry about getting
your money back. I personally promise that Desparate is financially
secure’. In April 2016, winding-up proceedings are begun against
Desparate. Its liabilities massively exceed its assets. George has
not been paid.
Advise Ollie whether he will be liable:
(a) personally to George; and
(b) to contribute to the assets of the company.
2011 Zone B Question#6
The question required us to advise Niall, Sabrina’s former husband with regards
to whether he can bring a derivative claim against Sabrina on behalf of Citadel Ltd
of which she is the managing director. In order to ascertain whether the Court will
allow proceedings for such a claim, it is essential to assess the rules pertaining to
