The company was set up to acquire and manage a property divided into flats which also included ‘amenity areas’ (tennis courts, swimming pool, gardens). It was argued that there should be implied into the articles of association an obligation on the part of each flat owner/member to contribute to the expenses of maintaining the amenity areas. The implication was said to be derived from the circumstances in which the property was acquired and the terms of the conveyance to the company.
Held: Such background facts were not admissible to construe the meaning of the articles. The court emphasised both the unusual nature of the contract between members of a company constituted by Articles of Association of the company and the very limited assistance which extrinsic evidence of surrounding circumstances can provide in construing the Articles. In construing the articles of association of the management company of a building divided into flats, background facts which would have been known to all the signatories were inadmissible because the articles should be regarded as addressed to anyone who read the register of companies, including persons who would have known nothing of the facts in question.
[1992] BCLC 693
England and Wales
Cited by:
Cited – Rose v Lynx Express Ltd. and Bridgepoint Capital (Nominees) Ltd CA 7-Apr-2004
In an request for pre-action discovery it was plainly wrong for the court to seek to decide in advance any element of the virtues of the case.
Held: The appeal should be allowed. The case was arguable and should be allowed to proceed.
Cited – Bermuda Cablevision Limited and others v Colica Trust Company Limited PC 6-Oct-1997
(Bermuda) An alternative remedy to winding up is available to a shareholder where oppressive conduct is alleged, though the main thrust is that the conduct is unlawful. . .
Cited – Chartbrook Ltd v Persimmon Homes Ltd and Others HL 1-Jul-2009
Mutual Knowledge admissible to construe contract
The parties had entered into a development contract in respect of a site in Wandsworth, under which balancing compensation was to be paid. They disagreed as to its calculation. Persimmon sought rectification to reflect the negotiations.
Held: . .
Cited – Attorney General of Belize and others v Belize Telecom Ltd and Another PC 18-Mar-2009
(Belize) A company had been formed to manage telecommunications in Belize. The parties disputed the interpretation of its articles. Shares had been sold, but the company was structured so as to leave a degree of control with the government. It was . .
These lists may be incomplete.
Updated: 15 July 2021; Ref: scu.196551
