Re BSB Holdings Ltd; London Merchant Securities Plc v Chargeurs Sa and Others: ChD 2 Aug 1995

Protection of minority shareholders was not to be used to impede the proper management of a company’s affairs. Directors must act in the company’s overall best interests despite prejudice to one class of shareholders.
Arden J said: ‘However, in my judgment, it is not the effect of Re Saul D Harrison and Sons plc that a remedy under section 459 can be given only if the directors have acted in breach of duty or if the company has breached the terms of its articles or some other relevant agreement. These matters constitute in most cases the basis for deciding what conduct is unfair. But the words of the section are wide and general and, save where the circumstances are governed by the judgments in Re Saul D Harrison and Sons plc, the categories of unfair prejudice are not closed. The standards of corporate behaviour recognised through section 459 may in an appropriate case thus not be limited to those imposed by enactment or existing case law.’


Arden J


Times 02-Aug-1995, Independent 07-Sep-1995


Companies Act 1985 459


England and Wales


CitedIn re Saul D Harrison and Sons plc CA 1995
The ‘legitimate expectations’ of a party were a label for the ‘correlative right’ to which a relationship between company members may give rise when, on equitable principles, it would be regarded as unfair for a majority to exercise a power . .

Cited by:

See AlsoRe BSB Holdings Ltd (No 2) ChD 1996
Arden J considered a submission that there could be no breach of duty by the directors unless the substantial purpose of their acts was to discriminate improperly against a group of shareholders. In rejecting that submission she commented as . .
Lists of cited by and citing cases may be incomplete.


Updated: 19 July 2022; Ref: scu.81761