Marcus and Mary are shareholders of a private company trading under the name of Maggie Resources Sdn Bhd, which is an RM2.00 company and they both hold shares in AEON Chemical Sdn Bhd, which is also an RM2.00. They had entered into a contract with Vijay Resources Sdn Bhd for both companies for the supply of packing materials but have failed to make payments to Vijay Resources Sdn Bhd despite numerous reminders and notices. Vijay Resources has approached you to advise the process of trying to sue Marcus and Mary personally for the losses suffered as a result of the contracts with Maggie Resources Sdn Bhd and AEON Chemical Sdn Bhd.

(a) Explain the effects of incorporation of a company [5 marks]

(b) What is meant by a corporate veil [5 marks]

(c) With reference to cases, explain the common law position towards lifting of the corporate veil of both Maggie Resources Sdn Bhd and AEON Chemical Sdn Bhd

Subject: Company Law in Malaysia