In the previous chapter we considered how the modern company grew of out of the law on unincorporated associations, how it used ideas long identi ed with town corporations created by royal charter, how it evolved from the joint stock company, and how shareholders in companies were granted limited liability by statute. One key element of the modern company, however, remained outstanding: the principle of separate corporate personality, which was created by the House of Lords in Salomon v A Salomon & Co Ltd (1897). We will refer to this principle as ‘the Salomon principle’. We will begin with a close reading of the Salomon litigation.