b) Was Mr. Lee’s wife entitled for the compensation?

Ans: In the given case of Lee Air Farming Limited, Mr. Lee had purchased life insurance policy

under the workman’s compensation Act under which the company was required to pay

compensation in case Mr. Lee sustained any accident. After Mr. Lee’s death in a plane accident,

his wife filed a petition claiming the amount of compensations with the court.

Yes, Mr. Lee’s wife was entitled for the compensation reason being one of the major feature of a

company i.e. separate legal entity. It means that a company is recognized as a legal person

having its own separate legal rights and obligations from those who run and own the company.

And even though, Mr. Lee who was the majority shareholder and practically the owner of the

company, he was still the employee of the company working as the pilot and the company and

Mr. Lee was never the same identity or status. After his death, Mr. Lee’s wife was in fact entitled

for the compensation because of the fact that Mr. Lee and the company both were two separate

legal personalities. Also, as the life insurance policy was purchased by Mr. Lee as an employee

of the company not the owner under the workman’s compensation Act, the company was entitled

to compensate to Mr. Lee’s wife again following the concept of separate legal entity.