Court confirms there is a principle of English law that enables a court in very limited circumstances to pierce the corporate veil

On 12 June 2013, the English Supreme Court handed down a unanimous judgment that discussed the ability of the English Family Division to treat the assets of companies wholly owned by one party to a divorce as available to that party for the purposes of ancillary relief.

The court confirmed that there is a principle of English law that enables a court in very limited circumstances to pierce the corporate veil, although there was not unanimity among their lordships regarding the width of the test to be applied. In any event, the court unanimously considered that those circumstances were not present in this case. The court also confirmed that the English Matrimonial Causes Act 1973 did not give the court any power to cut across the statutory scheme of company and insolvency law. However, on the facts of this case, the court found that the properties were held by the companies on a resulting trust by virtue of the particular circumstances in which the properties came to be vested in them…

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