Will the corporate veil of Goodfellas be lifted on the basis of the existence of an agency relationship between Scorcese and Goodfellas?
– You MUST answer this question
- Goodfellas Pasta Ltd (‘Goodfellas’) is one of the wholly owned
subsidiaries of Scorcese Italian Foods Ltd (‘Scorcese’). The profits of
Goodfellas are treated as those of Scorcese. Scorcese is in effective
control of Goodfellas; it also appoints the personnel who conduct the
business in Goodfellas. The office premises owned by Goodfellas have
been compulsorily purchased and compensation will be paid by the
local authority. Scorcese claims that the compensation should be paid
to itself directly as Goodfellas carries on the business as its agent.
Advise Scorcese as to the following:
a) Will the corporate veil of Goodfellas be lifted on the basis of the
existence of an agency relationship between Scorcese and
Goodfellas?
b) Will Scorcese and Goodfellas be treated as one single economic
entity?
c) Will the corporate veil of Goodfellas be lifted on the basis of justice?
