Macaura v Northern Assurance Co. (1925)

Company Law · Promoters — Duties and Liabilities

Facts.

Macaura owned all shares in a timber company and insured the company’s timber in his own name. Fire destroyed it.

Issue.

Did the sole shareholder have an insurable interest in the company’s property?

Held.

No. The timber belonged to the company, a separate person; Macaura had no insurable interest and could not claim.

Why it matters.

Separate personality cuts both ways — the shareholder gets limited liability but does not own the company’s assets.

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