Piercing the Veil of Corporate Fiction

Christian Andrew Labitoria Gallardo[1]

. Separate Juridical Personality

A corporation has a separate juridical personality which is different from its stockholders. This means that it is an entity independently recognized by law. The repercussion of having a separate identity recognized by law can stretch one’s imagination. Corporations can sue or be sued on its own, and it can own and manage properties under its own name. Moreover, it has the “right of succession”, meaning that it can survive beyond the lifetime of its incorporators and stockholders. Not only can it survive the death of the stockholders composing it, it can likewise withstand their incapacity and insolvency. Thus, it can easily contract long-term dealings because of the certainty of the continuity of its existence.

Concomitant to having a separate juridical personality, one of the most essential and well-sought features of a corporation is the concept of limited liability. Given that a corporation has a life of its own independently recognized by law, it can incur any liabilities separate from its stockholders.[1] Should the venture fail therefore,