Nothing to See Here? The Extension of Parent Company Liability in James Hardie Industries Plc v White

42 Pages Posted: 20 May 2020

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Tom White

Victoria University of Wellington, Faculty of Law, Student/Alumni

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Date Written: May 20, 2020

Abstract

In James Hardie Industries plc v White the New Zealand Court of Appeal looked to determine circumstances where a parent company could be directly liable for defective products produced by its subsidiary while upholding the principles behind separate corporate personality. The Court passed off the case as an unexceptional development in the law, based on an application of ordinary tort principles and supported by decisions from overseas jurisdictions. However, the Court neglected to consider the underlying policies of the cases it cited, ignored important distinctions between them and the present case and did not inquire into whether they were in fact relevantly applicable so that it in fact extended parent company liability for the acts and omissions of its subsidiary far beyond what overseas jurisdictions have held. In doing so, the Court implicitly lifted the corporate veil and failed to acknowledge the impact such a finding of liability would have on the corporate form.

Keywords: "Parent company liability","tort", "duty of care", "separate corporate personality" "economic loss" "corporate veil"

JEL Classification: K00, K13

Suggested Citation

White, Tom, Nothing to See Here? The Extension of Parent Company Liability in James Hardie Industries Plc v White (May 20, 2020). Victoria University of Wellington Legal Research Paper No. 25/2020. Available at SSRN: https://ssrn.com/abstract=3606085 or http://dx.doi.org/10.2139/ssrn.3606085

Tom White (Contact Author)

Victoria University of Wellington, Faculty of Law, Student/Alumni ( email )

PO Box 600
Wellington, Victoria 6140
New Zealand

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