PUTRAJAYA, April 9 The Court of Appeal has ruled that a five-star hotel in Kuala Lumpur is liable for the death of a Chinese national at its swimming pool seven years.
PUTRAJAYA: The Court of Appeal has ruled that a five-star hotel in Kuala Lumpur is liable for the death of a Chinese national at its swimming pool seven years ago.
Introduction
A separate legal entity – or rather, a corporate veil – exists to separate a corporate entity from its incorporators upon incorporation. Citing the century-old case
Solomon v A Solomon & Co Ltd,(1) Justice Nallini Pathmanathan stated the following in
Ong Leong Chiou v Keller (M) Sdn Bhd:(2)
The juristic principle comprising the bedrock of company law is the legal fiction that on incorporation, the corporate entity is clothed with a separate and distinct personality. It is a legal person distinct from its members.(3)
It is also well established that the corporate veil can be lifted or pierced when the corporation is used for fraudulent, dishonest and unlawful purposes.
A recent Federal Court decision has confirmed that the hotel industry cannot use a service charge to supplement employees' wages in order to meet the minimum threshold for wage requirements. While the decision may be unpopular among hoteliers and related or similar industries, it was inevitable. The long-term impact that it may have on society outweighs any likely detriment that it may cause to a particular industry.
The recent Federal Court decision in
Catajaya Sdn Bhd v Shoppoint Sdn Bhd(1) has breathed new life into the interpretation of termination clauses in contracts. Indeed, it sounded a cautionary note to the business community at large when the Federal Court held that termination clauses must be interpreted strictly.
Facts
The dispute arose from the termination of a share sale agreement (SSA) between Catajaya Sdn Bhd (appellant) and Shoppoint Sdn Bhd and its shareholders (respondents). Under the SSA, the appellant was to purchase a piece of land held by Shoppoint Sdn Bhd by acquiring its shares.
The SSA stipulated specific timelines for the payment of the purchase price, whereby the appellant would pay the balance purchase price by the agreed completion date.