Creasey v Breachwood Motors Ltd
| Jurisdiction | England & Wales |
| Judgment Date | 10 July 1992 |
| Date | 10 July 1992 |
| Court | Queen's Bench Division |
Queen's Bench Division
Before Mr Richard Southwell, QC
Company - transfer of assets - lifting the corporate veil
Where a company with a contingent liability to the plaintiff transferred its assets to another company which continued its business under the same trade name, the court would lift the veil of incorporation in order to allow the plaintiff to proceed against the second company.
Mr Richard Southwell, QC, so held, sitting as a deputy High Court judge in the Queen's Bench Division, dismissing an appeal by the defendant, Breachwood Motors Ltd ("Motors"), against an order of Master Trench dated May 15, 1992 making it liable to the plaintiff Eric Creasey for £53,835.03 damages together with interest, for his wrongful dismissal by Breachwood Welwyn Ltd ("Welwyn").
Mr Richard Behar for the plaintiff; Mr Andrew Lydiard for the defendants.
HIS LORDSHIP said Welwyn had dismissed the plaintiff as general manager on March 21, 1988 and he had issued a writ against Welwyn on June 9, 1988 alleging wrongful dismissal.
Welwyn had ceased trading on November 30, 1988 and its creditors, apart from the plaintiff, had been paid. The remaining assets were transferred to Motors.
The plaintiff obtained a default judgment against Welwyn, which by then had no assets. Welwyn was dissolved on June 11, 1991.
The takeover of Welwyn's assets had been carried out without regard to the separate entity of Welwyn and the interests of its creditors, especially the plaintiff. Motors had had to meet the demands of Welwyn's other creditors in order to continue its business and had done so.
Motors had not even offered to return...
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