The Corporate Legal Person

Journal of Corporate Law Studies, January 2018

36 Pages Posted: 29 Dec 2018

See all articles by Susan Watson

Susan Watson

University of Auckland Business School; European Corporate Governance Institute

Date Written: January 12, 2018

Abstract

The argument set out in this article is that the modern company is a creature of the state, with corporate legal personality derived from the state through the process of incorporation. Once incorporation takes place a legal person is created. Status as a legal person is different to the type of sociological personality that a group of individuals may develop organically that is recognised by the law. Also status as a legal person means corporate legal personality is more significant than just a shortcut mechanism to describe a collective of individuals or a set of characteristics. It is argued that the modern company is a nexus for contracts; a legal entity that is a legal person that derives its legal personality from the state. Far from being a “convenient heuristic formula”, corporate legal personality attaching to the nexus or entity separate from shareholders and all other corporate participants is the defining characteristic of the modern company.

Keywords: corporate law; corporate governance; legal personality

Suggested Citation

Watson, Susan Mary, The Corporate Legal Person (January 12, 2018). Journal of Corporate Law Studies, January 2018 , Available at SSRN: https://ssrn.com/abstract=3300383

Susan Mary Watson (Contact Author)

University of Auckland Business School ( email )

12 Grafton Rd
Private Bag 92019
Auckland, 1010
New Zealand

European Corporate Governance Institute ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

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