A Comparative Study On The Responsibility Of The Managers Of Non-Commercial Institutions Under The Protection Of The Doctrine Of Pierce The Corporate Veil

Non-commercial institutions have independent legal personality, like commercial institutions, so they can enter into a contract, owe someone or put debt on another obligation. Because legal personality of non-commercial institutions is independent of their managers, always the institutions become liable or creditor, not their managers or members; this is while in domestic law there is no rule  regarding management of non-commercial institutions and about the liability of their administrators  and members. On the other hand, the silence of law doesn't deny  the limited liability  of administrators and members of non-commercial institutions , because limited liability protection umbrella is raised over administrators of non-commercial institutions through acceptance of independent legal personality; therefore in this article we will review the responsibility of administrators of this type of institutions, regarding the rule of “pierce the corporate veil”. Initially the theory of “limited liability” will be analysed. In the following we will reveal  the differences and common aspects of commercial and non-commercial institutions after description of legal personality of Non-commercial institutions. Finally we will present the appropriate approach to the administrators of non-commercial institutions to be responsible for their actions by appealing to “pierce the corporate veil” doctrine. It is suggested to set rules in domestic law, according which each member of the institution who manages the organization and directly benefits from the profit-making activities of the institution, or makes legal personality, a cover for his personal activities, be responsible for the debts and obligations of the institution.