Juristic Personality or Corporate Personality
Ethical Natural law philosophers of the 17th and 18th centuries as well as the
metaphysical theorists of 19th century postulated the concept of will as an essential
requirement for exercising legal right. They also believed that personality is the
subjective possibility of a rightful will.
Legal personality is an artificial creation of law. Entities recognized by law are capable of
being parties to a legal relationship. A natural person is a human being whereas legal
persons are artificial persons, such as a corporation, created by law and given certain
legal rights and duties of a human being; a being, real or imaginary, who for the
purpose of legal reasoning is treated more or less as a human being[1]. All legal
persons can sue or be sued.
Theories of Juristic Personality
1. Fiction Theory – This theory was put forward by Von Savigny, Salmond, Coke,
Blackstone, and Holland etc. According to this theory, the personality of a corporation
is different from that of its members. Savigny regarded corporation as an exclusive
creation of law having no existence apart from its individual members who form the
corporate group and whose acts are attributed to the corporate entity. As a result of this,
any change in the membership does not affect the existence of the corporation.
It is essential to recognize clearly the element of legal fiction involved in this process. A
company is in law something different from its shareholders or members[2]. The
property of the company is not in law the property of the shareholders. The company may
become insolvent, while its members remain rich[3].
Gray supported this theory by saying that it is only human beings that are capable of
thinking, therefore it is by way of fiction that we attribute ‘will’ to non-human beings
through human beings who are capable of thinking and assign them legal personality.
