company law Corporate law (also known as company law or enterprise law) is the body of law governing the rights, relations, and conduct of persons, companies, organizations and businesses. The term refers to the legal practice of law relating to corp ...

, perpetual succession is the continuation of a

corporation A corporation or body corporate is an individual or a group of people, such as an association or company, that has been authorized by the State (polity), state to act as a single entity (a legal entity recognized by private and public law as ...

's or other organization's existence despite the death, bankruptcy, insanity, change in membership or an exit from the car of any owner or member, or any transfer of

stock Stocks (also capital stock, or sometimes interchangeably, shares) consist of all the Share (finance), shares by which ownership of a corporation or company is divided. A single share of the stock means fractional ownership of the corporatio ...

, etc. Perpetual succession, along with the common seal, is one of the factors explaining a corporation's legal existence as separate from those of its owners. This principle states that: *any change in membership of a company does not affect the status of the company, *death, insolvency, insanity etc. of any member of a company does not affect the continuity of the company. Thus the life of the company does not depend upon the life of its members. *it shall continue forever irrespective of continuity of its members or directors, except in case of

liquidation Liquidation is the process in accounting by which a Company (law), company is brought to an end. The assets and property of the business are redistributed. When a firm has been liquidated, it is sometimes referred to as :wikt:wind up#Noun, w ...

(or "winding up") of a company. It as well regards to the fact that a juridical entity separate from its owners may continue existing for an indefinite time period. This contrasts to legal entities that are not separate from their owners in that these entities are not normally continued after the life of their owners, although transfers can technically be made to new ownership.

References

{{DEFAULTSORT:Perpetual Succession Business terms