Theories of Corporate Personality.

Fiction Theory.

Propounded by Savigny.
Says, Corporation is an outcome of Legal Fiction. (कल्पनामा)
A corporation is a legal fiction—it exists only because the law says it does. It has no mind or will of its own but acts through humans.
Supported by Jurists like salmond , Holland and says this theory can only support judicial purpose.
This theory posits that a corporation is a legal invention, existing only as a concept created by law, not as a real entity.
It emphasizes that a corporation's personality and rights are solely derived from the legal framework that grants them.

In Salomon v. Salomon & Co. Ltd (1897), the UK House of Lords confirmed that once a company is legally incorporated, it is separate from its owner, even if one person owns almost all shares.

2. Concession Theory

Supporting Fiction theory, as the Corporation is a judicial person, it exists only because the state allows it.
It’s a power granted by the government, not a natural right.
Supported by Savigny, Salmond, coke, blackstone and dicey.

3. Purpose Theory

Says : Only humans has legal personality. Juristic persons are no person at all but they are meant for certain purposes only.
A legal entity is created to fulfill a specific purpose, and its assets are allocated toward that purpose.
However, Nepalese law have said that Corporations are person through various Precedents and Laws.

4. Bracket (symbolist) theory.

Rights and duties is given to members, not for corporation
Thus, for ones convenience the members are kept inside a bracket and the bracket is called corporation.
Members runs the co., so they are kept inside a bracket and they are given symbols, the symbols is called corporation (Apple, CG group)
Keythinkers : Ihering.

5. Realist Theory

Law cannot create entities
As Human is an organism, co., is also real where court and diff body reconizes them.
Corporation is a social organism.
A corporation is a real social organism with its own identity, will, and personality—distinct from its members.

Lastly, the content of this blog is for Academic Purpose only. Please check and find relevant text books for appropriate figures and descriptive court's reasoning.