Rationalising Corporate Disregard

Abstract

The area of corporate disregard has a poor reputation for certainty of reasoning. To provide an alternative way of approaching the issue, we conducted an empirical study of the relationship between rationale and outcome within UK corporate disregard cases from the nineteenth to the twenty-first century. We examine the evidence from three perspectives. First, we examine the broad range of instrumental rationales found in the case law by disregard rates in order to identify where issues might be arising with individual rationales. Secondly, as suggested in the wider empirical literature, we examine the rationale rates by jurisdiction in order to see whether there were problematic interpretation issues concentrated in particular parts of the court levels. Thirdly, we examine the rationale rates by substantive claim to see whether contextual aspects of the doctrine were influencing outcomes. By providing an empirical study on the rationales instrumental to corporate disregard outcomes we aim to introduce a broader evidential view of where concerns may lie, which can both aid critique of key judicial historical developments such as Adams v. Cape Industries (1990) and Prest v. Petrodel Resources Ltd (2013) and provide a broader evidence base that might aid future judicial reform of the area..

Keywords: company law, corporate disregard, veil piercing, veil lifting, empirical study

JEL Classification: K10, K12, K13, K22, K41, K42, O52