Soon after came the Limited Liability Act 1855, which in the event of a company's bankruptcy limited the liability of all shareholders to the amount of capital they had invested.
The beginning of modern company law came when the two pieces of legislation were codified under the Joint Stock Companies Act 1856 at the behest of the then Vice President of the Board of Trade, Mr Robert Lowe.
Under corporate law, corporations of all sizes have separate legal personality, with limited or unlimited liability for its shareholders.
Shareholders control the company through a board of directors which, in turn, typically delegates control of the corporation's day-to-day operations to a full-time executive.
This rule is called limited liability, and it is why corporations end with "Ltd." (or some variant like "Inc." and "plc").
In the words of British judge, Walton J, a company is...
The law of business organizations originally derived from the common law of England, but has evolved significantly in the 20th century.
However, procrastination amongst the legislature meant that in the United Kingdom it was not until the Joint Stock Companies Act 1844 that the first equivalent of modern companies, formed by registration, appeared.
But companies, almost inevitably, returned to the forefront of commerce, although in England to circumvent the Bubble Act 1720 investors had reverted to trading the stock of unincorporated associations, until it was repealed in 1825.