Application for orders under section 996 of the Companies Act 2006 on the ground that the affairs of Braid Group (Holdings) Limited (‘BGHL’) have been conducted in a manner that was unfairly prejudicial to the interests of some of its members. The respondent had wished to base his case upon complaints of conduct that had been unfairly prejudicial to himself, but those were not issues with which the petition has been concerned.
Held: If the respondent to a petition contends that it has been unfairly prejudiced, then it should cross-petition in order to seek a buy-out order in its favour: ‘I am not persuaded that the statutory provisions are sufficiently wide to permit the court to make an order in favour of a party who has entered the process as a respondent and who has remained only in that capacity. Section 996 provides for relief to be given ‘in respect of the matters complained of’. That is a reference to the complaint of the petitioner, in terms of section 994, that there has been prejudice to the interests of members generally or to some part of the members including at least the petitioner. In other words, the focus is on conduct prejudicial to the petitioner. To the same effect, section 996 makes clear that the court’s jurisdiction opens up if it is satisfied ‘that a petition under this Part is well founded’. That is a reference to the application by way of petition under section 994: again, the power to make an order may be exercised only under reference to the application of the member who has brought the petition. The power does not extend to a member who has not applied by way of petition.’
[2015] ScotCS CSOH – 146
Bailii
Scotland
Cited by:
Cited – Macom Gmbh v Bozeat and Others ChD 21-Jun-2021
Order regulating company’s affairs
COMPANY – Unfair prejudice – Petitioner 60% shareholder – Respondents 40% shareholders – Alleged breaches of director’s duties and failures to observe Shareholders’ Agreement – Undermining company’s corporate governance – Appropriate remedy – . .
These lists may be incomplete.
Updated: 10 July 2021; Ref: scu.558126 br>