The block of flats was owned by a company in which each tenant owned one share. The claimant company had bought twenty five flats, and now sought to sell them, but the freeholder refused to register share transfers saying that the claimant was in arrears with its service charge payments. The court was asked to say whether the sole director was acting in bad faith. The director had given his evidence as to the reasons for his actions and had not been cross-examined as to them. The claimant alleged personal hostility as between the director and its own alter-ego owner.
Held: The declaration was refused. Brennan QC said: ‘the circumstances in which Mr Crowther refused to permit registration of the shares do not begin to justify a conclusion that he was acting in bad faith and otherwise than in accordance with MML’s established policy. ‘
Judges:
Brennan QC
Citations:
[2008] EWHC 2843 (Ch), [2009] BCC 335, [2009] 1 BCLC 179
Links:
Jurisdiction:
England and Wales
Citing:
Cited – In Re Smith and Fawcett Ltd CA 1942
Directors to act Without Collateral Purpose
The primary duty of a director imposed by the general law is that he should act in what he considers to be the best interests of the company, and not for any collateral purpose. That duty is a subjective one that depends on the directors exercising . .
Lists of cited by and citing cases may be incomplete.
Landlord and Tenant, Company
Updated: 21 October 2022; Ref: scu.374397