The term „legal person“ can be ambiguous as it is often used as a synonym for terms that refer only to non-human legal persons, especially as opposed to „natural person“. [10] [11] The best-known case illustrating the operation of the concept of autonomous legal personality of a company is Salomon v A Salomon & Co Ltd [1897] AC 22 (HL). The case was bitterly contested by the receiver up to the House of Lords on behalf of the unsecured creditors of a company that became insolvent very soon after its registration under the Companies Act 1862. The case is significant because it confirmed the ability of a sole proprietor to transfer his business to a registered business, thereby shielding himself from the responsibilities of the business. In court cases involving physical entities, the Uttarakhand High Court has ordered that the Ganges and Yamuna, as well as all ships, be „living beings“. „legal person“ and appointed three persons as custodians to protect the rights of rivers from man-made pollution, for example „pilgrims` bathing rituals“. [22] Application of self-help measures to factual situations to circumvent the doctrine of separate legal personality From the separate identity of the company of its owners/shareholders and its officers/directors, it inevitably follows that when a company incurs a debt, this debt corresponds to the debts of the company that the company owes to the lender/creditor. Without more, the company`s debts are not someone else`s debt. This means that even the owners/shareholders of the company are not obliged to pay an amount that the company owes to the lender/creditor. Any action for recovery of the debt must be brought by the creditor who designates the company as the defendant in the claim. The owners/shareholders of the company are not parties to the contract according to which the sum due (the debt) belongs to the creditor, so a lawsuit against them will fail. It follows from the separate legal personality of companies and the capacity of a company to own property that a company may hold shares in another company.

This is the basis for the existence of groups that can and often consist of more than 100 companies, all of which are ultimately owned by a parent company. In the third typical scenario in Figure 3.4, Company B Ltd owns all the shares of Company A Ltd. Company B Ltd is the parent company of Company A Ltd and Company A Ltd is a wholly owned subsidiary of Company B Ltd. Not all organizations have legal personality. For example, directors of a corporation, legislature or government agency are generally not legal entities because they do not have the ability to exercise legal rights independently of the corporation or political body to which they belong. „In Germany, as elsewhere, company law has significantly changed its economic and social function. Incorporation or limited liability privileges were originally granted to allow a number of capitalists to embark on risky ventures without bearing the burden of personal responsibility. However, because of the ease with which companies can be incorporated in this country, and because of the rigidity with which the courts have applied the notion of company since the disastrous decision in Salomon v. Salomon & Co Ltd, a single trader or group of traders is almost tempted by law to conduct its business in the form of a limited liability company. even when there is no particular business risk and no debt capital is required.

Registered trade unions are legal persons. They may, by uniform representation proportional to their members, conclude collective agreements binding on all persons belonging to the categories specified in the agreement. Section 28 of the New Zealand Bill of Rights Act 1990 states: “ the provisions of this Bill of Rights apply, to the extent possible, for the benefit of all legal persons and all natural persons. Keeping track of all of your legal entity`s regulatory responsibilities can be both time-consuming and complex, especially if you add multiple entities within a business structure into the mix. According to Indian law, „shebaitship“ is the property belonging to the deity or idol as a „legal person“.