1.5 Concept of Corporate Personality, Corporate Veil, Limited Liability, and Corporate Citizenship

Corporate personality — the law's recognition of the incorporated body as a person: the company's rights and duties are its own. The corporate veil — the personality's screen between company and members. Lifting/piercing the veil (the exceptions where the law looks behind the screen): fraud or improper conduct (the company as a faade for wrongdoing); the sham or agency cases (the company as the member's alter ego); revenue and protective statutes' targeting of the real actors; and the guarantee's own door — a member who personally guarantees the company's debt cannot hide behind limited liability: Kamala Amatya v. Himalayan Bank (Law of Contract-II, this semester, Unit 1). Limited liability — the investor's capped risk: the grand risk- encouraging invention, with its costs externalised (creditors' caution — hence the statutory capital- and-discipline frame). Corporate citizenship — the modern discourse: the company as a citizen-like actor with rights and responsibilities — tax honesty, fair dealing, CSR, environmental care; in Nepal's frame the "company not distributing profits" (the non-profit company) shows the form's public-spirited use. The prescribed cases (personality and liability): • Sumargi Parajuli vs. Himalaya Spring Water, NKP 2074 B.S., Vol. 5, D.No. 9809, Pages 829 (Legal Personality, Separate Legal Entity, Limited Liability — Separate from its Members) — the personality landmark: shareholders of Himalayan Spring Water (Pvt.) personally agreed to sell…