A company is a corporate body of a company. A company is an artificial legal person. The law considers it separate and independent from the people who are part of it. The legal recognition given to the company is provided for in Section 26 Separate Legal Personality of the Companies' Act 2001 which states that: “A company incorporated under this Act shall be a body corporate in the name in which it is registered and shall continue to exist until until when it is canceled from the business register". This means that the company can use its own name to make transactions and does not need to go through its members; the company can own assets that do not belong to the members; the corporation can sue and be sued and be convicted of criminal offenses like an individual. It is said that the reason why the legal fiction of separate legal personality is created is a matter of convenience. However, unlike humans, a business does not have a natural lifespan. It can be dissolved by special procedures. The concept of separate legal personality is useful in large companies where there are many shareholders and these change frequently (perpetual succession). But simply changing shareholders has no effect on the existence of the company. THE RELATIONSHIP BETWEEN LEGAL PERSONALITY AND LIMITED LIABILITY It has been said that the most popular reason why a company is formed is to take advantage of the principle of limited liability. However, it must also be considered that, despite having a distinct legal personality, the company can have unlimited liability, i.e. the partners can still be responsible for the company's debts. By limited liability legal entity we mean the members of a joint stock company the shares are...... half of the document...... L'Albezero [19771 AC 774 (HL), a cargo of oil belonging to a company was transferred to the company during its voyage from South America to Europe. Both companies were wholly owned by the same "parent" company. After the change of ownership, the ship sank and the cargo was lost. When the first company sought to compensate for the loss, the shipowners argued that the second company was the true owner of the oil and could not claim because the statute of limitations for such claims had expired. Therefore neither company could claim. Roskill LJ: "each company in a group of companies... is a separate legal entity with separate legal rights and responsibilities whereby the rights of one company in a group cannot be exercised by another company in that group even whether the ultimate benefit of the exercise of such rights would accrue to the same person or entity’.