Straw Man Definition and Legal Meaning
On this page, you'll find the legal definition and meaning of Straw Man, written in plain English, along with examples of how it is used.
What is Straw Man?
(n). The term ‘straw man’ is used to represent a person who acts by receiving a title to a property, business right, or interest of any sort on behalf of another person, who for any reason cannot do such acts directly. For example a man with criminal record will not get a license for liquor business, then such person will apply for a licenses in somebody’s name, who has no criminal past. Such persons are called straw man. In these cases real owner controls all activities though it is not in his name.
History and Meaning of Straw Man
The term "Straw Man" originates from the days when farmers would place a scarecrow made of straw in their fields to trick birds into steering clear of their crops. In a legal context, a "Straw Man" is a person who acts on behalf of another person or entity, typically for the purpose of hiding the true ownership of something. For example, a business owner may transfer ownership of their business to a "Straw Man" in order to protect themselves from liability.
Examples of Straw Man
John is unable to get a liquor license due to his criminal record, so he asks his friend Mike to apply for the license using his name. Mike becomes the "Straw Man" owner of the liquor license, but John is actually running the business.
A company wants to purchase land without revealing their identity, so they use a "Straw Man" to buy the land in their name.
A politician wants to avoid direct criticism, so they misrepresent their opponent's argument by creating a "Straw Man" to attack, instead of addressing the actual argument.
Legal Terms Similar to Straw Man
Nominal Owner - A "Nominal Owner" is a person who appears to own something in name only, but does not actually have control or possession of it.
Front Organization - A "Front Organization" is an entity that is façade for a covert operation, typically used for illegal or unethical purposes.
Shell Company - A "Shell Company" is a business that exists only on paper, with no real business operations or assets, often used for financial fraud or tax evasion purposes.