The Commercial Case Law Index is a collection of judgments from African countries on topics relating to commercial legal practice. The collection aims to provide a snapshot of commercial legal practice in a country, rather than present solely traditionally "reportable" cases. The index currently covers 400 judgments from Uganda, Tanzania, Nigeria, Ghana and South Africa.
Get started on finding judgments that are relevant to you by browsing the topic list on the left of the screen. Click the arrows next to the topic names to reveal a detailed list of sub-topics. Most judgments are accompanied by a short summary written by subject-matter expert postgraduate students from the University of Cape Town.
This case looked at the whether the veil of incorporation could be lifted and the defendants held liable for the debt of the company as a result of their alleged fraudulent dealings.
The court considered that when the device of incorporation is used for some illegal or improper purpose, the court may disregard the principle that a company is an independent legal entity and lift the veil of corporate identity. A corporate personality can never be used as a cloak or a mask for fraud. The veil of incorporation will be lifted where it is proved that the company is being misused by its directors to perpetuate fraud.
The standard of proof in fraud cases requires a higher degree of probability than the proof required to demonstrate negligence.
The applicant failed to adequately plead the allegation of fraud. Accordingly, the veil of incorporation could not be lifted. The case was dismissed with costs.