Tortious liability of corporate groups: from control to coordination

Abstract

This article considers ways in which tort law can contribute to the extended liability of the corporate group, by creating liability beyond a wrongdoing but insolvent subsidiary. Current case law permits actions by claimants against the parent company where it owes them a duty of care separate from that owed by the subsidiary. The control exercised by the parent over the circumstances in which injury occurs is an important factor in establishing the duty of care. This article recommends the development of the tort of unlawful means conspiracy in the corporate group context so that it can be pleaded in circumstances of the reckless infliction of harm. Development of the tort in this way would be especially attractive in creating “sideways” liability as between group subsidiaries, based on their coordinated behaviour in creating risks of harm.