... unsecured creditors, claiming the company was an alias or agent of Salomon. The House of Lords held that as Salomon & Co Ltd was a separate and distinct person from Salomon then the debentures were valid and the remaining creditors of the new company should have been aware of the risk they were taking. (Keenan & Bisacre 1996 p3). This firmly establishes an incorporated company as a separate legal identity from its shareholders. The recognition of separate personality led to a number of consequences as shown below: Company Property * As a separate entity a company can own property and assets. The property does not belong to shareholders. In Macaura v Northern Assurance Co Ltd [1925] A.C. 619, it was established that a shareholder does not have insurable interest in a company's property. Macaura should not have effected an insurance policy on the timber in his own name, but in the name of ...

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