A Study On The Scope Of Denial Of Law Personality

This dissertation is based on the contract and the tort as the breakthrough point in order to explicit the scope of the rule of piercing the corporate veil and how it works in the contract and the tort as well as how to deal with it when it comes to the overlap of articles of law. The first part of this dissertation lays the foundation for the full text via analyzing legal basis of this rule, such as the connotation, the historical origin and the value. The second part focuses on the legislative and judicial history of China to reflect the importance and necessity of establishing this rule as the way of statute law. What is more, this part compares this rule of China with the relevant system of the United States, Germany and Japan in order to draw lessons from useful foreign experiences and improve the operability of piercing the corporate veil in our country. The third part analyzes the use of this rule in contract. In this part, the author mainly discuss whether and when this rule should be used in the situation of fraud, gross misunderstanding, shell company and contract of duty omission and how to solve the contract dispute when it comes to overlap of law, such as when it overlaps with subrogation. Other countries are not in favor of expanding and abusing the applicable scope of this rule in contract. So by studying other countries’ judicial practices, the author can conclude that under contract law system, it is better to use contract law rather than piercing the corporate veil to solve disputes. The fourth part of this dissertation aims at the use of piercing the corporate veil in tort, especially tort cases that are related to company social responsibility. This part studies the labor tort, the defective product tort, the environment tort and the improper competition tort. All of them may cause material injury so the scope of application of piercing the corporate veil should be expanded in these fields. The author also refers to the legal practice of the United States, Germany and Japan to support the author’s point of view. The final part of this dissertation puts forward some useful suggestions to perfect this rule. The first suggestion is making a distinction between voluntary creditors and involuntary creditors and enlarging the scope of plaintiffs of piercing the corporate veil, including the government, the consumer and the employee. The second suggestion is introducing judicial interpretation as soon as possible in order to solve the problem of overlapping of articles of law. Third, establishing the Enterprise Integrated Rule and consider parent-subsidiary corporation as a whole in the field of unfair competition liability and defective products liability and compel the parent corporation to undertake the liability in order to protect the interests of involuntary creditors. Forth, the Supreme Court should carry out Case Guiding System and offer ccourts the reference. As a result, the judicial practice will be uniform all over the country. Finally, the article of piercing the corporate veil should be added in each tort law, such as Product Quality Law, Anti-monopoly Law and Environmental Protection Law. By doing that, it may offer legal basis for piercing the corporate veil when apply it to material tort cases and make contribution to perfect this rule. However, no matter what the scope of application is, we should recognize that this rule is an exception and there is no reason to abuse it. Otherwise, the limited liability of corporation will be destroyed. In a word, when apply piercing the corporate veil, we must strictly meet the prerequisite requirements, and only when there is no other way to solve the dispute can we use this rule. The author hopes this dissertation can clarify the scope of application of piercing the corporate and make contribution to legislation and judiciary of China.