Adams v Cape Industries plc [1990] Ch 433 is a UK company law case on separate legal personality and limited liability of shareholders.

It has in effect been superseded by Lungowe v Vedanta Resources plc,[2] which held that a parent company could be liable for the actions of a subsidiary on ordinary principles of tort law.

The Court of Appeal unanimously rejected three allegations: that Cape should be part of a single economic unit, that the subsidiaries were a façade and that any agency relationship existed.

Slade LJ (for Mustill LJ and Ralph Gibson LJ) began by noting that to ‘the layman at least the distinction between the case where a company itself trades in a foreign country and the case where it trades in a foreign country through a subsidiary, whose activities it has full power to control, may seem a slender one….’ He approved Sir Godfray’s argument ‘save in cases which turn on the wording of particular statutes or contracts, the court is not free to disregard the principle of Salomon… merely because it considers that justice so requires.’ On the test of the ‘mere façade’, it was emphasised that the motive was relevant whenever such a sham or cloak is alleged, as in Jones v Lipman.

Mr. Morison urged on us that the purpose of the operation was in substance that Cape would have the practical benefit of the group's asbestos trade in the United States of America without the risks of tortious liability.

In Lubbe v Cape plc[3] Lord Bingham held that the question of proving a duty of care being owed between a parent company and the tort victims of a subsidiary would be answered merely according to standard principles of negligence law: generally whether harm was reasonably foreseeable.

In Chandler v Cape plc, it was held that the corporate veil was not relevant in tort cases, thus effectively circumventing Adams.

[4] In VTB Capital plc v Nutritek International Corp, Lord Neuberger remarked, "In addition, there are other cases, notably Adams v Cape Industries plc [1990] Ch 433, where the principle [of piercing the corporate veil] was held to exist (albeit that they include obiter observations and are anyway not binding in this court).