A company had been set up by two tobacco manufacturers, Mr Rothman and Mr Weinberg. The relationship between them had broken down to the extent that the two shareholders were not on speaking terms and that no business which deserved the name of business in the affairs of the company could be carried on. Even though the company was prosperous and making large profits, an application was now made for the company to be wound up.
Held: The company was not in a state that could have been contemplated at the time when the company had been formed and it should be terminated as soon as possible. Lord Cozens-Hardy MR referred to the grounds for winding up a partnership set out in Lord Lindley’s textbook on Partnership as including ‘Refusal to meet on matters of business, continued quarrelling, and such a state of animosity as precludes all reasonable hope of reconciliation and friendly cooperation’.
It was not necessary to show gross misconduct as a partner but only that the court must be satisfied that it is impossible for the partners to place that confidence in each other which each has a right to expect and that such impossibility has not been caused by the person seeking to take advantage of it.
Lord Cozens-Hardy MR
[1916] 2 Ch 426, [1916-17] All ER 1050
England and Wales
Cited by:
Approved – Ebrahimi v Westbourne Galleries Ltd and Others (on Appeal from In Re Westbourne Galleries Ltd) HL 3-May-1972
Unfair Prejudice to Minority Shareholder
A company had operated effectively as a partnership between two and then three directors. No dividends had been paid, but the directors had received salaries. One director was removed and sought an order for the other to purchase his shares, or . .
Lists of cited by and citing cases may be incomplete.
Landlord and Tenant, Company
Updated: 10 December 2021; Ref: scu.182079
