What is the ratio in Adams v Cape Industries?

The corporate veil can only be pierced in exceptional circumstances where the company is a mere facade. Mere control by a parent company over subsidiaries is insufficient to disregard separate legal personality.

What did the court decide in Adams v Cape Industries?

The Court of Appeal held that Cape Industries could not be held liable for its subsidiaries' asbestos-related debts, as there were no special circumstances justifying piercing the corporate veil.

Why is Adams v Cape Industries important for company law?

It established the modern restrictive test for piercing the corporate veil and remains the leading authority on when courts will disregard separate corporate personality in group company structures.

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