Advantages and disadvantages of corporations compared to sole proprietorships and partnerships.

A company is a business association which has the character of a legal person, distinct from its officers and shareholders. This is significant, as it allows the company to own property in its own name, continue perpetually despite changes in ownership, and insulate the owners against personal liability. However, in some instances, for example when the company is used to perpetrate fraud or acts ultra vires, the court may 'lift the corporate veil' and subject the shareholders to personal liability.

By contrast, a partnership is a business association which, strictly speaking, is not considered to be a legal entity but, rather, merely an association of owners. However, in order to avoid impractical results, such as the partnership being precluded from owning property in its own name, certain rules of partnership law treat a partnership as if it were a legal entity. Nonetheless, partners are not insulated against personal liability, and the partnership may cease to exist upon a change in ownership, for example, when one of the partners dies.

A sole proprietorship, also known as the sole trader or simply a proprietorship, is a type of business entity that is owned and run by one natural person and in which there is no legal distinction between the owner and the business. The owner is in direct control of all elements and is legally accountable for the finances of such business and this may include debts, loans, loss etc. The owner receives all profits (subject to taxation specific to the business) and has unlimited responsibility for all losses and debts. Every asset of the business is owned by the proprietor and all debts of the business are the proprietor's. It is a "sole" proprietorship in contrast with partnerships (which have at least 2 owners). A sole proprietor may use a trade name or business name other than his, her or its legal name. They will have to legally trademark their business name, the process being different depending upon country of residence.

Types of torts.

There are basically three types of torts: intentional torts, negligence and strict liability.

An intentional tort is a civil wrong that occurs when the wrongdoer engages in intentional conduct that results in damages to another. Striking another person in a fight is an intentional act that would be the tort of battery. Striking a person accidentally would not be an intentional tort since there was not intent to strike the person. This may, however, be a negligent act. Careless conduct that results in damage to another is negligence.

Generally, liability because of a tort only arises where the defendant either intended to cause harm to the plaintiff or in situations where the defendant is negligent. However, in some areas, liability can arise even when there is no intention to cause harm or negligence. For example, in most states, when a contractor uses dynamite which causes debris to be thrown onto the land of another and damages the landowner’s house, the landowner may recover damages from the contractor even if the contractor was not negligent and did not intend to cause any harm. This is called strict liability or absolute liability. Basically, society is saying that the activity is so dangerous to the public that there must be liability. However, society is not going so far as to outlaw the activity.

Acme Construction Company was constructing a highway. It was necessary to blast rock with dynamite. The corporation’s employees did this with the greatest of care. In spite of their precautions, some flying fragments of rock damaged a neighboring house. The owner of the house sued the corporation for the damages. The corporation raised the defense that the owner was suing for tort damages and that such damages could not be imposed because the corporation had been free from fault. Was this defense valid? No. While ordinarily fault is the basis of tort liability, there are cases in which absolute liability is imposed on the actor. This means that when harm is caused, it is no defense that none was intended or that due care had been exercised to prevent the harm.

Other examples of absolute liability situations would be harm caused by storage of flammable gas and explosives, crop dusting when the chemical that is used is dangerous, factories which produce dangerous fumes, smoke or soot in populated areas, and the production of nuclear material.

Common torts include:assault, battery, damage to personal property, conversion of personal property, and intentional infliction of emotional distress. Injury to people may include emotional harm as well as physical harm.

Assault: Intentionally threatening a person with an immediate battery.

Battery: Intentional offensive touching of another person without the person’s consent.

Intentional or accidental damage to personal property: Property damage can occur in a number of ways, such as automobile accidents; breaking, marring or staining of valuables; or poor aim (such as baseballs or gunshots accidentally sent through windows). But any action to recover for property damage is limited to the jurisdiction of the court. For example, a magistrate can only decide a case involving a fire that burned down a building if the damages are ten thousand dollars or less.

Intentional infliction of emotional distress: A claim for intentional infliction of emotional distress requires a plaintiff to show (1) that the defendant engaged in extreme and outrageous conduct that was done recklessly or with the intent to cause severe emotional distress and (2) the plaintiff experienced severe emotional distress as a result of the conduct. Extreme and outrageous conduct is that which goes beyond bounds of common decency and is atrocious and intolerable to the ordinary person. Severe emotional distress is distress of such an intensity and duration that no ordinary person would be expected to tolerate it. A plaintiff is not required to show that she has suffered a physical injury in order to recover damages for severe emotional distress.