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45-560: In 1891, the company took over the State Line (founded 1872) and was often referred to as the Allan & State Line. In 1897, Andrew Allan amalgamated the various branches of the Allan shipping empire under one company, Allan Line Steamship Company Ltd., of Glasgow . The company by then had added offices in Boston and London . In 1917, under Sir Montagu Allan , who represented the third generation of

90-402: A fellow libertarian, who stated that a "libertarian society would be a full-liability society where everyone is fully responsible for his actions and any harmful consequences they might cause". The 1957 Brussels Convention and the 1976 London Convention on Limitation of Liability for Maritime Claims permit the charterer, manager, operators and salvors of a ship, and the master and members of

135-499: A general principle of corporate law , in the United States, a parent entity and the sole owner are not liable for the acts of its subsidiaries. However, they may be liable for its subsidiaries' obligations when the law supports "piercing the corporate veil". Provided that the parent entity or the sole owner do not maintain separate legal identities from the subsidiary (through inadequate/ undocumented transfer of funds and assets),

180-477: A lifelong member of the Conservative Party, wrote in 1855: [T]hat he who acts through an agent should be responsible for his agent's acts, and that he who shares the profits of an enterprise ought also to be subject to its losses; that there is a moral obligation, which it is the duty of the laws of a civilized nation to enforce, to pay debts, perform contracts and make reparation for wrongs. Limited liability

225-578: A limited liability investor with a potentially crushing liability and restricting investment to the very wealthy. During the Overend Gurney crisis (1866–1867) and the Long Depression (1873–1896) many companies fell into insolvency and the unpaid portion of the shares fell due. Further, the extent to which small and medium investors were excluded from the market was admitted and, from the 1880s onwards, shares were more commonly fully paid. Although it

270-414: Is founded on the opposite principle and permits a man to avail himself of acts if advantageous to him, and not to be responsible for them if they should be disadvantageous; to speculate for profits without being liable for losses; to make contracts, incur debts, and commit wrongs, the law depriving the creditor, the contractor, and the injured of a remedy against the property or person of the wrongdoer, beyond

315-405: Is limited to a fixed sum, most commonly the value of a person's investment in a corporation, company or joint venture. If a company that provides limited liability to its investors is sued, then the claimants are generally entitled to collect only against the assets of the company, not the assets of its shareholders or other investors. A shareholder in a corporation or limited liability company

360-421: Is not controversial because this could and probably would be agreed to by both parties to the contract. However, limited liability for shareholders for torts (or harms that have not been agreed to in advance) is controversial because of concerns that such limited liability could lead to excessive risk-taking by companies and more negative externalities (i.e., more harm to third parties) than would be produced in

405-491: Is not personally liable for any of the debts of the company, other than for the amount already invested in the company and for any unpaid amount on the shares in the company, if any—except under special and rare circumstances that permit " piercing the corporate veil ". The same is true for the members of a limited liability partnership and the limited partners in a limited partnership . By contrast, sole proprietors and partners in general partnerships are each liable for all

450-433: Is related to the concept of separate legal personality bestowed on the corporate form , which is promoted as encouraging entrepreneurship by various economists, enabling large sums to be pooled towards an economically beneficial purpose. Limited liability has been justified as promoting investment and capital formation by reassuring risk averse investors. An early critic of limited liability, Edward William Cox ,

495-403: Is used to determine if piercing is appropriate or not. If shares are issued "part-paid", then the shareholders are liable, when a claim is made against the capital of the company, to pay to the company the balance of the face or par value of the shares. By the 15th century, English law had awarded limited liability to monastic communities and trade guilds with commonly held property. In

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540-560: The Allan Line through the height of its success, and when needed, stepped up to re-organize the family firm ready for his many sons and nephews on both sides of the Atlantic Ocean to take them into the 20th century. He is buried with his family at Mount Royal Cemetery , Montreal. In 1848, Andrew Allan married Isabella Ann Smith, one of the four daughters of John Smith (d.1872) of Athelstane Hall, Montreal, and his wife Betsy Rea. John Smith

585-670: The Allan Line Royal Mail Steamers , but also included banking and railways. He was Master of Foxhounds for the Montreal Hunt . Born in 1822 at Saltcoats , Ayrshire, Andrew Allan was the fourth son of Captain Alexander Allan and his wife Jean Crawford (1782–1856). He was a first cousin of Sir Alexander Tilloch Galt and his father was a first cousin of the Scottish bard, Robert Burns . In 1819, Allan's father established

630-575: The Allan Shipping Line , which became synonymous with running goods and passengers between Scotland and Montreal . After a parish education at Greenock , Andrew was brought into the family shipping business, then known as J & A Allan, of Glasgow . Of his four brothers, at this time James was running the Glasgow office, helped by Alexander; Bryce, was in charge of the Liverpool office, while Hugh

675-771: The Canadian Pacific Railway in 1900. Andrew Allan was president of several manufacturing enterprises, including the Montreal Rolling Mills Company; Cornwall Woollen Manufacturing; Dominion Oil Cloth; Canadian Rubber Company; Windsor Hotel of Montreal and the Montreal Lumber Company. In 1883, he co-founded the Citizens Gas Company of Montreal in an unsuccessful attempt to challenge the Montreal Gas Company. Among others, he

720-466: The Canadian West to become one of Canadas most important financial institutions. In addition to being an important shareholder, Andrew was a director from its start in 1861, to 1883 when he became its president, a position he held until his death. As president, he continued the bank's policy of western expansion, seeing the bank's assets grow by one-third but its net profits falling. Since its creation,

765-535: The Limited Liability Act 1855 . There was a degree of public and legislative distaste for a limitation of liability, with fears that it would cause a drop in standards of probity. The 1855 Act allowed limited liability to companies of more than 25 members (shareholders). Insurance companies were excluded from the act, though it was standard practice for insurance contracts to exclude action against individual members. Limited liability for insurance companies

810-527: The Manitoba and North Western Railway Company of Canada was a failure. The Allan family had invested heavily in the venture and Andrew, connected with the railway since 1883, was its president by 1892. Despite expansive and enthusiastic lobbying, by 1894 the Allans could not afford the interest payments on its debt and the company was put into receivership . A dispute quickly arose between the railway's bondholders and

855-543: The Montreal Ocean Steamship Company , incorporated in 1854. By 1857, the Allan family were the sole owners, whose chief advantage over their competition was the use of iron-hulled steamships with screw propellers . The company won government mail contracts and was subsidised for the number of immigrants it brought from Britain to Canada. There was never any doubt that Hugh Allan was the driving force behind what became Canada's leading steamship company, and

900-538: The 17th century, joint stock charters were awarded by the crown to monopolies such as the East India Company . The world's first modern limited liability law was enacted by the state of New York in 1811. In England it became more straightforward to incorporate a joint stock company following the Joint Stock Companies Act 1844 , although investors in such companies carried unlimited liability until

945-521: The 1880s and 1890s. Andrew had kept things as they were under his brother, but by 1897 it was necessary to make some major changes, in part to raise additional capital for a new fleet of ships. He presided over the dissolution of the family partnership and the creation of a steamship company with limited liability , taking the post of chairman in the Allan Line Steamship Company Limited, based in Glasgow . Andrew tirelessly represented

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990-451: The Allan family over control of the company's assets. The fact that Andrew took little direct part in the negotiations perhaps indicated the rise of younger family members within the Allan hierarchy. In 1898, after extensive litigation, administration of the company's assets passed to a receiver representing the bondholders. Andrew's nephew, H. Montagu Allan managed to pass the lease of the railway line from Portage la Prairie to Yorkton to

1035-579: The Allan family's shipping interests wherever they were needed. From 1873 until his death he was an influential member of the Montreal Harbour Commission and for several years he served as its chairman. In 1861, Andrew and Hugh Allan founded the Merchant's Bank of Canada which became an important part of the Allan family's financial empire. The bank had grown with particular success in Ontario and

1080-630: The Allan family, the company was purchased by Canadian Pacific Steamships , and by the following year the Allan name had disappeared from commercial shipping. The 1970s British television series The Onedin Line (1971-1980) is a complex and veiled take on the Allan Line Family and their steamships. In 1891, the Allan Line steamer Carthaginian collided with the York River Line steamer Charlotte in

1125-661: The Royal Light Infantry of Montreal. From 1862 until his death he was president of the Montreal Sailors Institute, established to promote sobriety and morality among seamen ashore. Apart from the funds collected by ships officers from their crews, (including those of the Allan Line ) the institute's main source of revenue was the Allan family. His other philanthropic interests included the Montreal Protestant House of Industry and Refuge, of which he

1170-456: The UK there was initially a widespread belief that a corporation needed to demonstrate its creditworthiness by having its shares only partly paid , as where shares are partly paid, the investor would be liable for the remainder of the nominal value in case the company could not pay its debts. Shares with nominal values of up to £1,000 were therefore subscribed to with only a small payment, leaving even

1215-402: The absence of limited liability. According to one estimate, negative corporate externalities on an annual basis are equal to between 5 and 20 percent of U.S. GDP. An issue in liability exposure is whether the assets of a parent entity and the sole owner need to be subject to the subsidiary's liabilities, when the subsidiary is declared insolvent and owes debt to its creditors . As

1260-469: The bank had been used by the Allan family, including Andrew, to finance their personal investments, particularly in Manitoba and towards the North Western Railway . The loans taken out by the Allans were almost always outstanding, which stunted a greater percentage of its investments going into more secure bonds. Andrew had enjoyed relative success in shipping and banking, but his involvement with

1305-409: The company cannot pay, although the other shareholders will not be so liable. This is known as co-signing. A shareholder who is also an employee of the corporation may be personally liable for actions the employee takes in that capacity on behalf of the corporation, in particular torts committed within the scope of employment. Limited liability for shareholders for contracts entered by the corporation

1350-417: The debts of the business (unlimited liability). Although a shareholder's liability for the company's actions is limited, the shareholders may still be liable for their own acts. For example, the directors of small companies (who are frequently also shareholders) are often required to give personal guarantees of the company's debts to those lending to the company. They will then be liable for those debts that

1395-673: The end of the nineteenth century for shareholders to be directors, protecting themselves from liability. In 1989, the European Union enacted its Twelfth Council Company Law Directive , requiring that member states make available legal structures for individuals to trade with limited liability. This was implemented in England and Wales in the Companies (Single Member Private Limited Companies) Regulations 1992, which allowed single-member limited-liability companies. Some argue that limited liability

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1440-410: The harm that limited liability causes. Such taxes could be structured to generate information for regulators about how risky the activities companies are undertaking are to third parties. The notion of corporate limited liability has met criticism from certain figures among the libertarian right . In For a New Liberty: The Libertarian Manifesto , Murray N. Rothbard approvingly quoted Robert Poole ,

1485-437: The judgment is likely to be in favor of the creditor. In the same regard, if a subsidiary is undercapitalized from its inception, that may be grounds for piercing the corporate veil. Further, if injustice/fraud to the creditor is proven, the parent entity or the owner may be held liable to compensate the creditor. Thus, there is not one characteristic that defines the piercing of a corporate veil – a factors test

1530-447: The limit, however small, at which it may please him to determine his own liability. Others argue that while some limited liability is beneficial, the privilege ought not to extend to liability in tort for environmental disasters or personal injury because this leads to excessive risk-taking and negative externalities by corporations. Others argue that limited liability should be permitted, but should be taxed more heavily to offset

1575-427: The multitude of his other business interests. For the most part, Andrew remained comfortably under his brother's wing. In 1870, he wrote "every year I have even more reason to wonder at, and admire his (Hugh's) business capabilities." When Hugh died in 1882, Andrew took his place as head of the Allan family's Canadian enterprises, presiding over the peak of the shipping firm's worldwide cargo and passenger activities in

1620-433: The principle of limited liability. The development of limited liability facilitated the move to large-scale industrial enterprise, by removing the threat that an individual's total wealth would be confiscated if invested in an unsuccessful company. Large sums of personal financial capital became available, and the transferability of shares permitted a degree of business continuity not possible in other forms of enterprise. In

1665-680: The shipping channel at Baltimore , Maryland . Among those aboard the Carthaginian was the Danish-American composer Asger Hamerik . While both boats were damaged, neither sank. In 1905, the Allan Line steamer Parisian was involved in a collision with the Albano off of Halifax, Nova Scotia . The owners of the Albano were found by the Exchequer Court of Canada to be fully at fault, according to Reports of Cases Relating to Maritime Law. The case

1710-595: Was a director of Confederation Life and the Montreal Telegraph Company , succeeding his brother Hugh as president of the latter in 1882. Andrew Allan was chairman of St. Paul's Church from 1872 to 1901, which under him and through his own significant financial donations became the wealthiest Presbyterian church in Canada. He was a life member of the St Andrew's Society of Montreal and served as an officer in

1755-490: Was a greystone mansion that dominated Upper Peel Street in the Golden Square Mile , near to Andrew's brother's house, Ravenscrag . Designed by John William Hopkins, it was built in 1865 and enlarged in 1873. Andrew Allan also owned a farm near Lachine, Quebec . Andrew and Isabella were the parents of eight children, Limited liability Limited liability is a legal status in which a person's financial liability

1800-413: Was a native of Athelstaneford and became one of Montreal's leading dry goods merchants. Isabella's eldest sister, Caroline, had married Andrew's brother Hugh in 1844. Mrs Allan's sister, Elizabeth, married Hartland St. Clair MacDougall (brother of George Campbell MacDougall ) and the last remaining sister married James St. George Bellhouse, of the firm Bellhouse & Dillon. The Allans home, Iononteh ,

1845-470: Was admitted that those who were mere investors ought not to be liable for debts arising from the management of a corporation, throughout the late nineteenth century there were still many arguments for unlimited liability for managers and directors on the model of the French société en commandite . Such liability for directors of English companies was abolished in 2006. Further, it became increasingly common from

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1890-525: Was allowed by the Companies Act 1862 . The minimum number of members necessary for registration as a limited company was reduced to seven by the Companies Act 1856 . Limited companies in England and Wales now require only one member. Similar statutory regimes were in place in France and in the majority of the U.S. states by 1860. By the final quarter of the nineteenth century, most European countries had adopted

1935-557: Was expanding the family's interests in Montreal . With the rapid growth of the business in Montreal, it was decided that Andrew would be best placed there. As a clerk, Andrew joined the newly organised shipping firm of Edmonstone, Allan & Co., of which his brother, Hugh , was partner. By 1846, Andrew had also become a partner and from 1863 the firm was known as the H & A Allan, of Montreal. Andrew worked closely with his brother in forming

1980-458: Was later appealed to Canada's supreme court. The Allan Line fleet evolved over the course of decades, changing as new ships were added, lost at sea, sold, or scrapped: Andrew Allan (shipowner) Andrew Allan (1 December 1822 – 27 June 1901) was a Scottish -born Canadian businessman and financier. In 1882, he succeeded his brother, Sir Hugh Allan , of Ravenscrag , in the Allan family's Canadian enterprises that were centred on

2025-410: Was made a life governor in 1863. He was Master of the Montreal Hunt from the 1870s, and like other members of his family he took a great interest in floriculture and horses. In comparison to his brother Hugh Allan , Andrew's business ability is often overlooked. While he lacked his brother's entrepreneurial flair and despite his failure with the railway in the Canadian West , he nonetheless steered

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