Jones v Lipman [1962] 1 WLR 832 is a UK company law case concerning piercing the corporate veil

Piercing the corporate veil

Piercing the corporate veil or lifting the corporate veil is a legal decision to treat the rights or duties of a corporation as the rights or liabilities of its shareholders or directors. Usually a corporation is treated as a separate legal person, which is solely responsible for the debts it...

. It exemplifies the principal case in which the veil will be lifted, that is, when a company is used as a "mere facade" concealing the "true facts", which essentially means it is formed to avoid a pre-existing obligation.

Facts

Mr Lipman contracted to sell a house at 3 Fairlawn Avenue, Chiswick

Chiswick

Chiswick is a large suburb of west London, England and part of the London Borough of Hounslow. It is located on a meander of the River Thames, west of Charing Cross and is one of 35 major centres identified in the London Plan. It was historically an ancient parish in the county of Middlesex, with...

, Middlesex

Middlesex

Middlesex is one of the historic counties of England and the second smallest by area. The low-lying county contained the wealthy and politically independent City of London on its southern boundary and was dominated by it from a very early time...

 (now Ealing

Ealing

Ealing is a suburban area of west London, England and the administrative centre of the London Borough of Ealing. It is located west of Charing Cross and around from the City of London. It is one of the major metropolitan centres identified in the London Plan. It was historically a rural village...

W4) to Mr Jones for £5,250. He changed his mind and refused to complete. To try and avoid a specific performance order, he conveyed it to a company formed for that purpose alone, which he alone owned and controlled.

Judgment

Russell J ordered specific performance against Mr Lipman and the company.