Tag: Company

Ashdown and Others v Griffin and Others: ChD 19 Oct 2017

Judgment on the trial as to quantum following a decision on liability in relation to a petition under the Companies Act 2006, section 994, complaining of conduct unfairly prejudicial to the interests of the petitioners, as to their shares in a company

Judges:

Paul Matthews HHJ

Citations:

[2017] EWHC 2601 (Ch)

Links:

Bailii

Jurisdiction:

England and Wales

Company

Updated: 01 April 2022; Ref: scu.599617

Rakusens Ltd v Baser Ambalaj Plastik Sanayi Ticaret AS: CA 11 Oct 2001

A company had sought and obtained leave to serve proceedings on a foreign based company, by serving documents on a local agent. The local agent was an independent contractor, who received and transmitted orders to the company, but who, themselves, had no authority to bind the company in contract.
Held: The section allowed service at a ‘place of business’ within the jurisdiction. As a commission agent, unable to conclude business for the defendants, the address was not a place of business of the defendants. The claim was not validly served.

Judges:

Buxton, Arden, LJJ, Bodey J

Citations:

Gazette 01-Nov-2001, Times 09-Nov-2001, [2001] EWCA Civ 1820, [2002] 1 BCLC 104

Links:

Bailii

Statutes:

Companies Act 1985 695(2)

Jurisdiction:

England and Wales

Citing:

Applied – Adams v Cape Industries plc CA 2-Jan-1990
Proper Use of Corporate Entity to Protect Owner
The defendant was an English company and head of a group engaged in mining asbestos in South Africa. A wholly owned English subsidiary was the worldwide marketing body, which protested the jurisdiction of the United States Federal District Court in . .
Lists of cited by and citing cases may be incomplete.

Litigation Practice, Company

Updated: 01 April 2022; Ref: scu.166723

The Welsh Ministers v Price and Another: CA 7 Nov 2017

The Court was asked a point of practice as to the circumstances in which it is permissible and, where permissible, appropriate to join a third party to proceedings for restoration of a dissolved company to the register of companies.

Judges:

Sir Terence Etherton MR, Longmore, Irwin LJJ

Citations:

[2017] EWCA Civ 1768

Links:

Bailii

Jurisdiction:

England and Wales

Company, Litigation Practice

Updated: 01 April 2022; Ref: scu.599379

Hindle v John Cotton Ltd: HL 3 Jul 1919

Viscount Finlay said: ‘Where the question is one of abuse of powers, the state of mind of those who acted, and the motive on which they acted, are all important, and you may go into the question of what their intention was, collecting from the surrounding circumstances all the materials which genuinely throw light upon that question of the state of mind of the directors so as to show whether they were honestly acting in discharge of their powers in the interests of the company or were acting from some bye-motive, possibly of personal advantage, or for any other reason.’

Judges:

Viscount Finlay, Viscount Cave, and Lords Dunedin, Shaw, and Wrenbury

Citations:

(1919) 56 Sc LR 625, [1919] UKHL 625

Links:

Bailii

Jurisdiction:

Scotland

Cited by:

Cited – Eclairs Group Ltd and Glengary Overseas Ltd v JKX Oil and Gas Plc SC 2-Dec-2015
Company Director not Trustee but is Fiduciary
The Court was asked about an alleged ‘corporate raid’, an attempt to exploit a minority shareholding in a company to obtain effective management or voting control without paying what other shareholders would regard as a proper price.
Held: The . .
Cited – Mills v Mills 1938
(High Court of Australia) Where the main purpose of the directors’ resolution (in this case to increase the share base) is to benefit the company it matters not that it incidentally also benefits a director.
Dixon J pointed out the difficulties . .
Lists of cited by and citing cases may be incomplete.

Company

Updated: 30 March 2022; Ref: scu.595473

Ultraleisure Ltd v Stapleton and Others: ChD 21 Jan 2009

Ultraleisure Limited (‘the company’) acting by its liquidator seeks relief against two former directors in respect of alleged misappropriations in excess of pounds 3m.

Judges:

David Richards J

Citations:

[2009] EWHC 67 (Ch)

Links:

Bailii

Jurisdiction:

England and Wales

Company, Torts – Other

Updated: 30 March 2022; Ref: scu.594616

Wilton UK Ltd v Shuttleworth and Others: ChD 4 Sep 2017

The Court was asked as to the validity, potential validity, or otherwise, of service of a claim form and particulars of claim in a CPR Part 7 claim. Service took place in proceedings brought as a derivative claim pursuant to Chapter 1 of Part 11 of the Companies Act 2006

Judges:

Davis-White QC HHJ

Citations:

[2017] EWHC 2195 (Ch)

Links:

Bailii

Jurisdiction:

England and Wales

Company, Litigation Practice

Updated: 30 March 2022; Ref: scu.594588

Deutsche Bank Ag v Sebastian Holdings Inc: ComC 28 Apr 2016

Judges:

Waksman QC HHJ

Citations:

[2017] EWHC 913 (Comm)

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

See Also – Deutsche Bank Ag v Sebastian Holdings Inc ComC 14-Aug-2009
. .
See Also – Deutsche Bank Ag v Sebastian Holdings Inc ComC 1-Dec-2009
. .

Cited by:

See Also – Deutsche Bank Ag v Sebastian Holdings Inc ComC 16-Dec-2016
. .
See Also – Deutsche Bank Ag v Sebastian Holdings Inc ComC 13-Dec-2017
. .
Lists of cited by and citing cases may be incomplete.

Company, Banking

Updated: 27 March 2022; Ref: scu.588904

Immo Chiaradia SPRL and Another v Etat belge: ECJ 15 Jun 2017

ECJ (Annual Accounts of Certain Types of Companies – Principle That A True and Fair View Must Be Given : Judgment) Reference for a preliminary ruling – Directive 78/660/EEC – Annual accounts of certain types of companies – Principle that a true and fair view must be given – Principle that valuation must be made on a prudent basis – Issuing company of a share option recognising the grant date price of the option in the course of the accounting year in which the option is exercised or at the end of its period of validity

Citations:

ECLI:EU:C:2017:465, [2017] EUECJ C-444/16

Links:

Bailii

Jurisdiction:

European

Company

Updated: 27 March 2022; Ref: scu.588276

Baker Tilly UK Audit Llp and Others v Financial Reporting Council and Others: CA 7 Jun 2017

Principal ground of appeal: interpretation of paragraph 12(1)(f) of the Guidance issued by the Financial Reporting Council on the delivery of formal complaints – Key concept in dispute – ‘non-trivial’ failure to act competently

Judges:

Arden, King, Sales LJJ

Citations:

[2017] EWCA Civ 406

Links:

Bailii

Jurisdiction:

England and Wales

Company

Updated: 26 March 2022; Ref: scu.584532

Clegg v The Estate and Personal Representatives of Andrew Gregory Pache and Others: CA 11 May 2017

These proceedings arise out of the diversion by a company director (now deceased), in breach of his fiduciary duty to the company, of funds and business opportunities to another company in which he enjoyed a concealed beneficial interest.

Judges:

McCombe, Briggs, Thirlwall LJJ

Citations:

[2017] EWCA Civ 256

Links:

Bailii

Jurisdiction:

England and Wales

Company

Updated: 25 March 2022; Ref: scu.583648

Cosmetic Warriors Ltd and Another v Gerrie: CA 5 May 2017

This appeal concerns the true construction of shareholders’ rights of pre-emption contained in the Articles of Association of the two claimant companies, Cosmetic Warriors Limited and Lush Cosmetics Limited. The Articles of each company are in materially identical form. Article 5 states that no share in the company may be transferred except in accordance with the provisions which it lays down. In short, the other shareholders are given the opportunity to purchase the relevant shares at a ‘prescribed price’, which is to be determined in default of agreement by two independent chartered accountants. To the extent that the shares are not taken up at that price by the other shareholders, or sold at that price by the company to external purchasers of whom or which it approves, the vendor then has a 90-day period during which he may transfer them ‘to any person at any price (not being less than the prescribed price)’.

Judges:

Beatson, Lindblom, Henderson LJJ

Citations:

[2017] EWCA Civ 324

Links:

Bailii

Jurisdiction:

England and Wales

Company

Updated: 25 March 2022; Ref: scu.583650

G Attwood Holdings Ltd and Another v Woodward and Others: ChD 15 May 2009

The court was asked how far a director may go in the way of making preparations for future competition against the company of which he is a director, and how far the company is able to restrain such competition after the resignation of the director in the absence of a restraint covenant.

Judges:

John Martin QC

Citations:

[2009] EWHC 1083 (Ch)

Links:

Bailii

Jurisdiction:

England and Wales

Company

Updated: 24 March 2022; Ref: scu.581929

Blackwell v HM Revenue and Customs: CA 6 Apr 2017

The court was asked whether a taxpayer may, in computing the gain accruing to him on the disposal of shares, bring into account by way of deduction expenditure incurred by him in buying his release from a personal contractual obligation to a third party restrictive of his ability to vote or sell those shares.

Judges:

Longmore, Patten, Briggs LJJ

Citations:

[2017] EWCA Civ 232

Links:

Bailii

Jurisdiction:

England and Wales

Capital Gains Tax, Company

Updated: 24 March 2022; Ref: scu.581427

Power Adhesives Ltd v Sweeney and Others: ChD 31 Mar 2017

‘I heard the Claimant’s application for a declaration that the decision by the directors of the Claimant to issue 490,000 B shares having a nominal value of andpound;1 each was taken in breach of their fiduciary duties, is voidable and should be set aside. I granted the declaration sought by the company. This judgment explains my reasons for so doing.’

Judges:

Marsh CM

Citations:

[2017] EWHC 676 (Ch)

Links:

Bailii

Jurisdiction:

England and Wales

Company

Updated: 24 March 2022; Ref: scu.581330

Dunford and Elliott v Johnson and Firth Brown: CA 1977

A report which had been prepared confidentially was disclosed to 43 per cent of shareholders of a company (the institutional shareholders), but not the others, who then complained to the court.
Held: The others were entitled to the information: ‘This widespread use of the information drives a hole into the blanket of confidence; especially when that information is being used – or, shall I say misused – for the benefit some potential shareholders, and not for the benefit of the others. So much so that it would not be reasonable that the stipulation for confidence should be enforced.’

Judges:

Lord Denning MR

Citations:

[1977] 1 Lloyd’s Rep. 505

Jurisdiction:

England and Wales

Cited by:

Cited – Marks and Spencer plc v Freshfields Bruckhaus Deringer (A Firm) ChD 2-Jun-2004
The claimant sought an injunction preventing the respondent form of solicitors acting for a client in a bid for the claimant, saying that the firm was continuing to act for it, and that a conflict of interest arose.
Held: Though the . .
Cited – Marks and Spencer Group Plc and Another v Freshfields Bruckhaus Deringer CA 3-Jun-2004
The defendant firm of solicitors sought leave to appeal against an injunction requiring them not to act for a client in making a bid to take over the business of the claimant, a former client of the firm.
Held: Leave was refused. The appeal . .
Lists of cited by and citing cases may be incomplete.

Legal Professions, Company

Updated: 23 March 2022; Ref: scu.200341

Balkanbank v Naser Taher and Others: QBD 13 Feb 1995

The plaintiff had obtained a worldwide Mareva injunction, giving an undertaking for damages. On its discharge, the defendants sought to make a counterclaim. The defendant company and its subsidiaries sought to counterclaim for their damages suffered as a result of the injunction. The Irish court had ordered an enquiry as to the damages. The counterclaim now additionally pleaded torts of malicious prosecution against the plaintiff. The defendant sought to add as defendants in the original claim (and claimants in the counterclaim) subsidiary companies which had also suffered as a result of the injunction.
Held: The English court had jurisdiction to entertain the counterclaim relating to an alleged breach of the joint venture agreement under which the original injunction had been granted. It was desirable that the additional defendants should be joined to avoid a multiplicity of proceedings, and the claims fell within RSC15.6 after it had been extended following Vendervell Trustees. The remedy under a counterclaim might also be available to the company’s subsidiaries. It was said that a claimant (the additional defendants here) could not pursue a claim of civil malicious prosecution where they were not parties to the original claim. It was arguable that a tort of malicious prosecution of a civil action could succeed and it should go ahead, with the defendants joined in as claimants under the counterclaim. The claim for abuse of process should also proceed to trial.

Judges:

Clarke J

Citations:

Times 14-Apr-1995, [1995] 1 WLR 1067

Citing:

Cited – Vendervell Trustees Ltd v White HL 1971
If the dispute could be adjudicated in the absence of a party and where no order was sought against that party, joinder was unnecessary and generally not allowed.
Order 15 Rule 13 requires that the presence of the party to be joined is . .
Cited – Tetra Molectric Limited v Japan Imports Limited CA 1976
The court had allowed another company to be added as respondent to an appeal by a plaintiff against the judge’s decision against a patent’s validity. ‘Sub-paragraph (ii) of paragraph (b) widens the discretion of the court to a great extent, for now . .
Cited – Montgomery v Foy, Morgan and Co 1895
The case of Norrois v Beazley was criticised as too narrow an interpretation of the rules. The court decsribed ‘one of the great objects of the Judicature Acts, namely that where there is one subject matter out of which several disputes arise, all . .
Cited – Norris v Beazley 1877
A person could not be added to a claim as defendant where the plaintiff has no claim against him and no wish to join him. . .
See also – Balkanbank v Taher and Others (No 2) CA 18-Nov-1994
The plaintiffs had sued in Ireland and obtained a Mareva injunction. That injunction was then first extended to a worldwide injunction, before being set aside. The court could itself to enquire as to damages without deciding whether to enforce the . .
Cited – Union Bank of the Middle East Ltd v Clapham CA 15-Jul-1981
The bank having sued the defendant under a guarantee, the defendant sought to join in the principal debtor company to pursue a counterclaim. The defendant appealed a refusal on the ground that the principal would not itself have been given leave to . .
Cited – Gurtner v Circuit CA 1968
The Court described the gap in provision for the recovery of damages for injury where the driver of a vehicle was uninsured: ‘if (a) the defendant was not insured at the time of the accident or (b) his policy of insurance was avoided in the . .
Cited – Amon v Raphael Tuck and Sons Ltd 1956
The court analysed the circumstances under which additional parties might be joined to an action by a defendant, applying a narrow interpretation. The court considered whether a defendant may be added against the parties’ wishes: ‘There are two . .
Cited – Atid Navigation Co Ltd v Towage and Shipping Co Ltd 1955
The judge refused to allow an additional party to be joined to an action to pursue a counterclaim. The issues between the present parties could ‘perfectly well be decided’ without the additional party. . .
Cited – Pender v Taddei CA 22-Apr-1898
At first instance the defendant had been refused permission to join in another party (Bellani) who was a joint contractor, as a defendant to the counterclaim.
Held: The appeal failed. . .
Cited – Metal und Rohstoff AG v Donaldson Lufkin and Jenrette Inc CA 27-Jan-1989
The claimants sued for negligent advice and secured judgment. The defendant company became insolvent, and so the plaintiff now sued the US parent company alleging conspiracy. The court considered a tort of malicious prosecution of a civil claim, . .
Cited – Speed Seal Ltd v Paddington CA 1985
The court was asked whether the defendant should be permitted to add to his pleadings a counterclaim asserting that the action was brought in bad faith for the ulterior motive of damaging the defendants’ business, and not for the protection of any . .
Cited – Goldsmith v Sperrings Ltd CA 1977
Claims for Collateral Purpose treated as abuse
The plaintiff commenced proceedings for damages for libel and an injunction against the publishers, the editors and the main distributors of Private Eye. In addition, he issued writs against a large number of other wholesale and retail distributors . .
See Also – Balkanbank v Taher and Others 19-Feb-1994
Disclosure of legal advice. . .
Lists of cited by and citing cases may be incomplete.

Torts – Other, Company

Updated: 23 March 2022; Ref: scu.78113

Re Southbourne Sheet Metal Co Ltd: CA 9 Sep 1992

The Secretary of State for Trade and Industry had sought orders of disqualification against the director and a co-director under the provisions of the Company Directors Disqualification Act 1986. The Secretary of State’s summons was supported by an affidavit from one of the receivers of the company.
Held: The director’s appeal succeeded. A discontinuance by the DTI led to a standard order for costs against the discontinuer.

Judges:

Nourse LJ

Citations:

Gazette 09-Sep-1992, [1993] 1 WLR 244, [1993] BCLC 135

Statutes:

Company Directors Disqualification Act 1986, Insolvent Companies (Disqualification of Unfit Directors) Proceedings Rules 1987 (SI 1987 No.2023) 2

Jurisdiction:

England and Wales

Citing:

Cited – Re Elgindata Ltd (2) CA 15-Jul-1992
A successful plaintiff who had not been shown to have behaved improperly or unreasonably was not to have his costs reduced or be ordered to pay any part of his opponents costs for having pursued some unsuccessful points.
Nourse LJ said that . .

Cited by:

Cited – Perinpanathan, Regina (on The Application of) v City of Westminster Magistrates Court and Another CA 4-Feb-2010
The appellant’s daughter had been stopped entering the country with andpound;150,000 in cash. The police sought an order for its forfeiture, suspecting a link with terrorism. The magistrates found no evidence of such, and declined to make the order, . .
Cited – Perinpanathan, Regina (on The Application of) v City of Westminster Magistrates Court and Another CA 4-Feb-2010
The appellant’s daughter had been stopped entering the country with andpound;150,000 in cash. The police sought an order for its forfeiture, suspecting a link with terrorism. The magistrates found no evidence of such, and declined to make the order, . .
Lists of cited by and citing cases may be incomplete.

Company, Costs

Updated: 23 March 2022; Ref: scu.85883

Re DTEK Finance Plc: ChD 2 Dec 2016

Application for an order to be made pursuant to section 896 of the Companies Act 2006 convening a meeting of creditors for the purposes of considering and, if thought fit, approving a proposed scheme of arrangement.

Judges:

Newey J

Citations:

[2016] EWHC 3562 (Ch)

Links:

Bailii

Statutes:

Companies Act 2006 896

Jurisdiction:

England and Wales

Company

Updated: 04 February 2022; Ref: scu.577840

Randall and Quilter Investment Holdings Plc: ComC 3 Jul 2013

Application for the sanction of the court to a proposed scheme of arrangement pursuant to sections 895 and following of the Companies Act 2006. The scheme also involves a reduction of the share capital of the company, for which the court’s confirmation is sought.

Judges:

Henderson J

Citations:

[2013] EWHC 4357 (Comm)

Links:

Bailii

Jurisdiction:

England and Wales

Company

Updated: 31 January 2022; Ref: scu.575327

Lee v Lee’s Air Farming Limited: PC 11 Oct 1960

Mr Lee had formed a company, Lee’s Air Farming Limited and held nearly all its shares. He was the managing director, but by profession a pilot. The company was formed to conduct an aerial top-dressing business. He appointed himself the chief pilot for the company. In the Court of Appeal of New Zealand, North J said: ‘These powers were moreover delegated to him for life and there remained with the company no power of management whatsoever. One of his first acts was to appoint himself the only pilot of the company, for, although article 33 foreshadowed this appointment, yet a contract could only spring into existence after the company had been incorporated. Therefore, he became in effect both employer and worker. True, the contract of employment was between himself and the company: see Booth v Helliwell, but on him lay the duty both of giving orders and obeying them. In our view, the two offices are clearly incompatible. There could exist no power of control and therefore the relationship of master-servant was not created.’
Held: Appeal allowed. ‘one person may function in dual capacities. ‘ and ‘Ex facie there was a contract of service . . the real issue is whether the position of the deceased as sole governing director made it impossible for him to be the servant of the company in the capacity of chief pilot of the company. . . there was no such impossibility. There appears to be no greater difficulty in holding that a man acting in one capacity can give orders to himself in another capacity than there is in holding that a man acting in one capacity can make a contract with himself in another capacity. The company and the deceased were separate legal entities. The company had the right to decide what contracts for aerial top-dressing it would enter into. The deceased was the agent of the company in making the necessary decisions.’

Judges:

Viscount Simons, Lord Reid, Lord Tucker, Lord Denning, Lord Morris

Citations:

[1960] 3 All ER 420, [1960] UKPC 33, [1960] 3 WLR 758, [1961] AC 12

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

Cited – Salomon v A Salomon and Company Ltd HL 16-Nov-1896
A Company and its Directors are not same paersons
Mr Salomon had incorporated his long standing personal business of shoe manufacture into a limited company. He held nearly all the shares, and had received debentures on the transfer into the company of his former business. The business failed, and . .

Cited by:

Cited – Ben Hashem v Ali Shayif and Another FD 22-Sep-2008
The court was asked to pierce the veil of incorporation of a company in the course of ancillary relief proceedings in a divorce. H had failed to co-operate with the court.
After a comprehensive review of all the authorities, Munby J said: ‘The . .
Lists of cited by and citing cases may be incomplete.

Company, Employment, Commonwealth

Updated: 28 January 2022; Ref: scu.445368

Re Portman Insurance Plc: ChD 23 Nov 2016

Part 8 claim form for certification under Article 25(2) of Council Regulation (EC) No 2157/2001 on the Statute for a European Company (SE) (‘the SE Regulation’), which came into effect on 8 October 2001, conclusively attesting to the completion of pre-merger acts and formalities.

Jones Reg
[2016] EWHC 2994 (Ch)
Bailii
England and Wales

Company, European

Updated: 26 January 2022; Ref: scu.571986

Dowling And Others v Minister for Finance: ECJ 8 Nov 2016

ECJ (Judgment) Regulation (EU) No 407/2010 – European Financial Stabilisation Mechanism – Implementing Decision 2011/77/EU – European Union financial assistance to Ireland – Recapitalisation of national banks – Company law – Second Directive 77/91/EEC – Articles 8, 25 and 29 – Recapitalisation of a bank by means of judicial direction order – Increase in share capital without general meeting decision and without the shares issued being offered on a pre-emptive basis to existing shareholders – Issue of new shares at a price lower than their nominal value

C-41/15, [2016] EUECJ C-41/15, ECLI:EU:C:2016:836
Bailii, WLRD
Regulation (EU) No 407/2010
European

Banking, Company

Updated: 25 January 2022; Ref: scu.571269

In re Bird Precision Bellows Ltd: CA 1986

The company which was formed to combine one party’s expertise in the manufacturing of precision bellows with the general experience of two others in financial, commercial and industrial matters. For several years the company’s affairs had worked smoothly and prospered until in a spirit of mutual recrimination, at an extraordinary general meeting two of the directors, the plaintiff minority shareholders were removed. The majority consented to an order to purchase the minority interests, and the parties asked the court to settle the price. The judge had ordered payment of the value of the shares pro rata, without deduction of the usual element for the fact that they were minority shareholdings. The majority appealed.
Held: In acting under the Act, the judge was exercising an unfettered discretion. He had only to do what he thought just and equitable in the circumstances to remedy the fault. The appropriate remedy was one which would ‘put right and cure for the future the unfair prejudice which the petitioner has suffered at the hands of the other shareholders of the company.’ He had properly allowed for the fact that the business had developed from a quasi-partnership. The fact that the order was made by consent created no inference that an open market value would be used.

Oliver LJ
[1986] Ch 658, [1985] 3 All ER 523
Companies Act 1985 75(3) 74(4)(d)
England and Wales
Citing:
Applied – Dean v Prince CA 1954
The court had criticised an auditors’ valuation of a company’s shares.
Held: The criticism was not correct. However. if the court was satisfied that the valuation was made under a mistake, it would not be binding on the parties.
Denning . .
Appeal from – In re Bird Precision Bellows Ltd ChD 1984
The court considered the method of valuation of a minority shareholding in a forced purchase by the other shareholders. Nourse J said: ‘I would expect that in a majority of cases where purchase orders are made under section 75 in relation to . .

Cited by:
Cited – CVC/Opportunity Equity Partners Limited and Opportunity Invest II Limited v Luis Roberto Demarco Almeida PC 21-Mar-2002
(Cayman Islands) The respondent was a minority shareholder. An offer was made to buy out his interest. He petitioned for the winding up of the company on the just and equitable ground. The claimants obtained an injunction to prevent him doing so, . .
Cited – Grace v Biagioli and others CA 4-Nov-2005
The petitioner complained that he had first been removed as director, and that the remaining directors had misdescribed the company’s profits and paid those profits to themselves as management expenses and in breach of a resolution requiring an . .
Cited – G v G and Another FdNI 25-Oct-2003
There had been a long but argumentative marriage, and the parties disputed distribution of the assets on an ancillary relief application.
Held: The husband could not claim to discount shareholdings as a minority shareholding where he also . .

Lists of cited by and citing cases may be incomplete.

Company

Updated: 22 January 2022; Ref: scu.182784

Re Singh Brothers Contractors (North West) Ltd: ChD 27 Jun 2013

Derivative claim on behalf of the company under section 261 of the Companies Act 2006 against the first defendant, a director of the second defendant, for breach of director’s duty, breach of fiduciary duty and breach of trust. The claimant sought orders for damages, an account, further or other relief and costs. The claimant also sought an order that he be indemnified out of the company’s assets in respect of the legal costs of the derivative claim. It was said that the claimant expected to recover more than andpound;800,000.

Hodge QC Hhj
[2013] EWHC 2138 (Ch)
Bailii
England and Wales

Company

Updated: 20 January 2022; Ref: scu.514959

Prudential Assurance Company Ltd v Revenue and Customs: SC 25 Jul 2018

PAC sought to recover excess advance corporation tax paid under a UK system contrary to EU law. It was now agreed that some was repayable but now the quantum. Five issues separated the parties.
Issue I: does EU law require the tax credit to be set by reference to the overseas tax actually paid, as HMRC submit, or by reference to the foreign nominal tax rate (‘FNR’), as PAC submits?
Held: HMRC Appeal dismissed: credit for foreign dividends should be by reference to the FNR, rather than by reference to the actual or effective tax incurred overseas.
Issue II: Was compound interest payable on tax levied in breach of EU law, on the basis that HMRC were unjustly enriched by the opportunity to use the money in question?
Held: HMRC’s appeal Allowed. Sempra Metals Ltd v IRC failed to allow for several features, and there were later inconsistent developments and cases.
Issue III: does a claim in restitution lie to recover lawful ACT which was set against unlawful mainstream corporation tax?
Held: No. HMRC’s appeal was allowed. Setting the unlawful MCT against the lawful ACT was not enough to qualify as a ‘San Giorgio’ claim.
Following Issue I, Issue IV did not arise.
Issue V(a): where ACT from a pool including unlawful and lawful ACT is set against an unlawful MCT liability, is the unlawful ACT regarded as a pre-payment of the unlawful MCT liability or is the ACT so utilised regarded as partly lawful and unlawful pro rata?
Held: PAC’s cross-appeal was allowed. . Unlawful ACT is set first against unlawful MCT. Because unlawful MCT is a nullity, the unlawful ACT is recoverable unless it has been set against a lawful MCT charge.
Issue V(b): Is domestic FII when carried back to an earlier quarter, to be treated as having been applied to relieve the lawful and unlawful ACT pro rata, or only lawful ACT?
Held: PAC’s cross-appeal allowed. Domestic FII carried back to an earlier quarter is to be applied to relieve only lawful ACT. HMRC’s pro rata approach would deprive a company of the tax credit at the FNR required under EU law.

Lord Mance, Lord Sumption, Lord Reed, Lord Carnwath, Lord Hodge
[2018] UKSC 39, [2018] WLR(D) 527, [2018] STC 1657, [2019] AC 929, [2018] 3 WLR 652, [2018] BTC 31, [2018] STI 1499, UKSC 2016/0102
Bailii, Bailii Summary, WLRD, SC, SC Summary, SC Summary Video, SC 2018 Feb 20 am Video, SC 2018 Feb 20 pm Video, SC 2018 Feb 21 am Video, SC 2018 Feb 21 pm Video
Income and Corporation Taxes Act 1988 231(1) 238(1) 239
England and Wales
Citing:
At CA – The Prudential Assurance Company Ltd v HM Revenue and Customs CA 19-Apr-2016
The issues on this appeal all relate to what have been called ‘portfolio holdings’; that is to say dividends paid on shares in foreign companies held as investments, where the investor holds less than 10 per cent of the voting power in the company . .
Cited – Metallgesellschaft Ltd and Others v Inland Revenue Commissioners and Another Hoechst Ag and Another v Same ECJ 8-Mar-2001
The British law which meant that non-resident parent companies of British based businesses were not able to recover interest on payments of advance corporation tax, was discriminatory against other European based companies. Accordingly the law was . .
Cited – Test Claimants In The FII Group Litigation v CIR ECJ 12-Dec-2006
ECJ (Opinion of Geelhoed AG) Interpretation of Articles 43 and 56 EC and Articles 4(1) and 6 of Council Directive 90/435/EEC of 23 July 1990 on the common system of taxation applicable in the case of parent . .
Cited – Amministrazione Delle Finanze Dello Stato v Spa San Giorgio ECJ 9-Nov-1983
ECJ Questions submitted for a preliminary ruling – reference to the court – right of every national court – stage of the proceedings before the national court – nature of the decision to be given by the national . .
Cited – The Test Claimants In The CFC and Dividend Group Litigation v Inland Revenue ECJ 23-Apr-2008
First subparagraph of Article 104(3) of the Rules of Procedure – Freedom of establishment – Free movement of capital – Direct taxation – Corporation tax – Share dividends paid to a resident company by a non-resident company – Rules on controlled . .
Cited – Haribo Lakritzen Hans Riegel BetriebsgmbH and Another v Linz ECJ 10-Feb-2011
Free movement of capital – Corporation tax – Exemption of nationally-sourced dividends – Exemption of foreign-sourced dividends only if certain conditions are complied with – Application of an imputation system to non’exempt foreign’sourced . .
Cited – Test Claimants In the FII Group Litigation v HM Revenue and Customs ChD 27-Nov-2008
The claimants were companies with parent companies in the UK and other subsidiaries not so resident, both in the EU and outside. They complained of the differences in treatment under corporation tax of the payment of dividends between the . .
Cited – Test Claimants in the FII Group Litigation v Commissioners of Inland Revenue and Another ECJ 13-Nov-2012
Articles 49 TFEU and 63 TFEU – Payment of dividends – Corporation tax – Case C-446/04 – Test Claimants in the FII Group Litigation – Interpretation of the judgment – Prevention of economic double taxation – Equivalence of the exemption and . .
Overruled in Part – Sempra Metals Ltd v Inland Revenue Commissioners and Another HL 18-Jul-2007
The parties agreed that damages were payable in an action for restitution, but the sum depended upon to a calculation of interest. They disputed whether such interest should be calculated on a simple or compound basis. The company sought compound . .
Cited – Westdeutsche Landesbank Girozentrale v Islington London Borough Council HL 22-May-1996
Simple interest only on rate swap damages
The bank had paid money to the local authority under a contract which turned out to be ultra vires and void. The question was whether, in addition to ordering the repayment of the money to the bank on unjust enrichment principles, the court could . .
Cited – Kleinwort Benson Ltd v Lincoln City Council etc HL 29-Jul-1998
Right of Recovery of Money Paid under Mistake
Kleinwort Benson had made payments to a local authority under swap agreements which were thought to be legally enforceable when made. Subsequently, a decision of the House of Lords, (Hazell v. Hammersmith and Fulham) established that such swap . .
Cited – Morris-Garner and Another v One Step (Support) Ltd SC 18-Apr-2018
The Court was asked in what circumstances can damages for breach of contract be assessed by reference to the sum that the claimant could hypothetically have received in return for releasing the defendant from the obligation which he failed to . .
Cited – Johnson v Unisys Ltd HL 23-Mar-2001
The claimant contended for a common law remedy covering the same ground as the statutory right available to him under the Employment Rights Act 1996 through the Employment Tribunal system.
Held: The statutory system for compensation for unfair . .
Cited – Fleming (T/A Bodycraft) v Revenue and Customs HL 23-Jan-2008
The transitional rules introducing time limits for failing to deduct VAT inputs made insufficient allowance for the decisions in Marks and Spencer and Grundig.
Held: Lord Hope said: ‘To be compatible with EU law, taxpayers were entitled to be . .
Cited – Littlewoods Ltd and Others v Commissioners for Her Majesty’s Revenue and Customs SC 1-Nov-2017
The appellants had overpaid under a mistake of law very substantial sums in VAT over several years. The excess had been repaid, but with simple interest and not compound interest, which the now claimed (together with other taxpayers amounting to 17 . .
Cited – Revenue and Customs v The Investment Trust Companies SC 11-Apr-2017
Certain investment trust companies (ITCs) sought refunds of VAT paid on the supply of investment management services. EU law however clarified that they were not due. Refunds were restricted by the Commissioners both as to the amounts and limitation . .
Cited – Littlewoods Retail Ltd and Others v HM Revenue and Customs (No 2) ChD 28-Mar-2014
The claimants had recovered very substantial overpayments made of VAT. They sought recovery of compound interest. The ECJ, on reference, said that this was a matter for national law.
Held: The claim succeeded. The sections of the 1994 Act were . .
Cited – Littlewoods Ltd and Others v HM Revenue and Customs CA 21-May-2015
The company sought repayment by way of restitution for overpaid taxes. The tax had been repaid, but only as simple interest, and not compounded. Both parties now appealed from a decision that the Act did not apply to exclude under sections 78 and 80 . .
Cited – Moses v Macferlan KBD 1760
An action for money had and received will only lie where it is inequitable for the defendant to retain the money. The defendant in an action for money had and received ‘can be liable no further than the money he has received’. . .
Cited – Walker v Constable 20-Jun-1798
. .
Cited – Banque Financiere De La Cite v Parc (Battersea) Ltd and Others HL 16-Apr-1998
The making of an order for restitution after finding an unjust enrichment by subrogation, is not dependant upon having found any common or unilateral intention of the parties. The House distinguished between contractual subrogation of the kind most . .
Cited – Walker v Constable 20-Jun-1798
. .
Cited – Depcke v Munn And Another 4-Feb-1828
Lord Tenterden CJ said: ‘the courts have held again and again that interest cannot be recovered in an action for money had and received . . This has been decided so often, that I cannot now venture to allow the question to be agitated.’ . .
Cited – Fibrosa Spolka Akcyjna v Fairbairn Lawson Combe Barbour Ltd HL 15-Jun-1942
A contract for the supply by the respondents of special machinery to be manufactured by them was treated as an ordinary contract for the sale of goods. It began valid, but suffered frustration by the outbreak of war.
Held: Lord Wright restated . .
Cited – BP Exploration Co (Libya) Ltd v Hunt (No 2) 1979
The contract between the parties relating to an oil concession in Libya had been frustrated by the nationalisation of the field.
Held: The court considered the setting of damages where the plaintiff had delayed in notifying the defendant of . .
Cited – Riches v Westminster Bank Ltd HL 1947
The amount of interest payable on compulsory purchase of land depends upon the value given to the land and the length of the period from the time of entry until reinstatement, the period during which the claimant is dispossessed. During that time, . .

Lists of cited by and citing cases may be incomplete.

Company, European, Corporation Tax

Updated: 17 January 2022; Ref: scu.620139

EIC Services Ltd European Internet Capital Ltd v Phipps, Paul, Barber: CA 30 Jul 2004

Whether issue of additional shares had been properly authorised

Lord Justice Peter Gibson Mr Justice Newman Lord Justice Sedlay
[2004] EWCA Civ 1069, [2004] 2 BCLC 589, [2005] 1 WLR 1377, [2005] 1 All ER 338, [2004] BCC 814
Bailii
Companies Act 1985 35A(1)
England and Wales
Citing:
Cited – Hill v Permanent Trustee Company of New South Wales Ltd PC 1930
A bonus issue does not reduce those assets since the assets and liabilities side of the balance sheet remains unchanged but the capital and reserves side of the balance sheet is rearranged with a reduction in the amount of the profits or other . .
Cited – Re Cleveland Trust plc ChD 1991
The issue and allotment of bonus shares, once accepted by the allottee shareholder, involves a relationship between the company and the shareholder analogous to a contractual relationship. . .
Cited – Bell v Lever Brothers Ltd HL 15-Dec-1931
Contract – Mutual Mistake Test
Bell was director and chairman of Niger, a subsidiary of Lever Brothers Ltd who dismissed him, offering and paying pounds 30,000 compensation. Lever then discovered that Mr Bell had made secret profits at the expense of Niger for which he could have . .
Cited – Associated Japanese Bank (International) Ltd v Credit du Nord SA 1988
A contract of guarantee was made, but based upon a term of fundamental importance which was mistaken as to the existence of certain machines.
Held: The court must first look to the nature of the purported agreement. Steyn J said: ‘Logically, . .
Cited – Great Peace Shipping Ltd v Tsavliris (International) Ltd CA 14-Oct-2002
The parties contracted for the hire of a ship. They were each under a mistaken impression as to its position, and a penalty became payable. The hirer claimed that the equitable doctrine of mutual mistake should forgive him liability.
Held: . .

Lists of cited by and citing cases may be incomplete.

Company

Updated: 08 January 2022; Ref: scu.199804

Royal Mail Estates Limited v Maple Teesdale Borzou Chaharsough Shirazi: ChD 2 Jul 2015

A contract had been made but one of the parties was not yet incorporated. The court was asked whether it was deemed to have been made with the signatory.
Held: For section 36C(1), a ‘contrary agreement’ would be established if the parties, looking at the matter objectively, had intended that the contract would not have effect as having been made with the ‘agent’.

Kliein QC HHJ
[2015] EWHC 1890 (Ch), [2015] WLR(D) 290, [2016] 1 WLR 942, [2015] BCC 647
Bailii, WLRD
Companies Act 1985 36C(1)
England and Wales
Citing:
Cited – Braymist Limited and Others v Wise Finance Company Limited CA 20-Feb-2002
The claimant company set out to sell land whilst it was still only in the process of incorporation. Its solicitors had signed as agents, and now sought an order for the purchaser to complete the contract. The respondent had not known of the . .
Cited – Phonogram Ltd v Lane CA 1982
A collateral contract was entered into with a company which had not then been incorporated under which an advance by Phonogram to support an intended new pop group was repayable by the company if a recording contract was not entered into within one . .

Lists of cited by and citing cases may be incomplete.

Company, Contract

Updated: 02 January 2022; Ref: scu.550339

Credit Suisse v Allerdale Borough Council: CA 20 May 1996

Builder’s Guarantee Ultra Vires LA

The council set out to provide a swimming pool using powers under s.19 of the 1976 Act. Purporting to use powers under s.111 of the 1972 Act, it set up a company to develop a site by building a leisure pool and time-share units, with a view to selling the time-share units to pay for the cost of building the pool. The council gave a guarantee to help the company to finance the project, and on the strength of this the company obtained a facility from the bank. The sale of the time-share units proved unsatisfactory and the company went into liquidation. The bank sued the council under the guarantee to recover the sums owed to it by the company.
Held: The guarantee was ultra vires where it had been given to a company when the authority was acting outside it’s proper powers. Where a statutory corporation purports to enter into a contract which it is not empowered by the relevant statute to enter into, the corporation lacks the capacity to make the supposed contract. This lack of capacity means that the document and the agreement it contains do not have effect as a legal contract. It exists in fact but not in law. It is a legal nullity. The purported contract which is in truth not a contract does not confer any legal rights on either party. Neither party can sue on it. Any third party dealing with a local authority should be aware of that fact [of limited capacity and competence] and of the potential legal risk.
Hobhouse LJ said: ‘The discretion of the court in deciding whether to grant any remedy is wide one. It can take into account many considerations, including the needs of good administration, delay, the effect on third parties, and the utility of granting the relevant remedy.’

Hobhouse LJ
Times 20-May-1996, [1997] QB 306
Local Government Act 1972 111, Local Government (Miscellaneous Provisions) Act 1976 819
England and Wales
Citing:
Appeal from – Credit Suisse v Allerdale Borough Council QBD 17-Jun-1994
A Local Authority’s guarantee for its own company was void, having been given for impermissible reasons. . .
Applied – London and Clydeside Estates v Aberdeen District Council HL 8-Nov-1979
Identifying ‘maandatory’ and ‘regulatory’
The appellants had sought a Certificate of Alternative Development. The certificate provided was defective in that it did not notify the appellants, as required, of their right to appeal. Their appeal out of time was refused.
Held: The House . .

Cited by:
Cited – Stretch v The United Kingdom ECHR 24-Jun-2003
The claimant had taken a lease of property from a local authority. Relying upon an option for renewal, he invested substantially in the property, but it was then decided that the option was ultra vires.
Held: Property rights protected under . .
Cited – Regina v Soneji and Bullen HL 21-Jul-2005
The defendants had had confiscation orders made against them. They had appealed on the basis that the orders were made more than six months after sentence. The prosecutor now appealed saying that the fact that the order were not timely did not . .
Cited – Kilby v Basildon District Council Admn 26-Jul-2006
Tenants complained that the authority landlord had purported to vary a clause in his secure tenancy agreement which gave certain management rights to tenants.
Held: The powers to let on secure tenancies were governed by statute. The clause . .
Cited – Birmingham City Council v Qasim and Others CA 20-Oct-2009
The council argued that the defendant was not a tenant granted to him as a secure tenancy since he had not been granted the tenancy in accordance with its policies. An employee had manipulated the Council’s system to grant tenancies to bypass the . .
Cited – UKI (Kingsway) Ltd v Westminster City Council SC 17-Dec-2018
Short issue as to the requirements for valid ‘service’ of a completion notice so as to bring a newly completed building within liability for non-domestic rates. The notice had been served by email where no statutory authority existed for this.
Local Government, Contract, Company, Banking

Updated: 31 December 2021; Ref: scu.79620

Arbuthnott v Bonnyman and Others: CA 20 May 2015

Appeal from refusal of unfair prejudice petition.
After listing cases: ‘I would extract from them the following principles:
(1) The limitations on the exercise of the power to amend a company’s articles arise because, as in the case of all powers, the manner of their exercise is constrained by the purpose of the power and because the framers of the power of a majority to bind a minority will not, in the absence of clear words, have intended the power to be completely without limitation. These principles may be characterised as principles of law and equity or as implied terms: Allen at 671; Assenagon at 278-280.
(2) A power to amend will be validly exercised if it is exercised in good faith in the interests of the company: Sidebottom at 163
(3) It is for the shareholders, and not the court, to say whether an alteration of the articles is for the benefit of the company but it will not be for the benefit of the company if no reasonable person would consider it to be such: Shuttleworth at 18-19, 23-24, 26-27; Peters’ American Delicacy Co at 488.
(4) The view of shareholders acting in good faith that a proposed alteration of the articles is for the benefit of the company, and which cannot be said to be a view which no reasonable person could hold, is not impugned by the fact that one or more of the shareholders was actually acting under some mistake of fact or lack of knowledge or understanding: Peters’ American Delicacy Co at 491. In other words, the court will not investigate the quality of the subjective views of such shareholders.
(5) The mere fact that the amendment adversely affects, and even if it is intended adversely to affect, one or more minority shareholders and benefit others does not, of itself, invalidate the amendment if the amendment is made in good faith in the interests of the company: Sidebottom at 161, 163-167, 170-173; Shuttleworth; Citco at 490, 493; Peters’ American Delicacy Co at 480, 486.
(6) A power to amend will also be validly exercised, even though the amendment is not for the benefit of the company because it relates to a matter in which the company as an entity has no interest but rather is only for the benefit of shareholders as such or some of them, provided that the amendment does not amount to oppression of the minority or is otherwise unjust or is outside the scope of the power: Peters’ American Delicacy Co at 481, 504, 513, 515; Assenagon.
(7) The burden is on the person impugning the validity of the amendment of the articles to satisfy the court that there are grounds for doing so: Citco at 491; Peters’ American Delicacy Co at 482′

[2015] EWCA Civ 536, [2015] 2 BCLC 627, [2015] BCC 574
Bailii
Companies Act 2006 994
England and Wales
Cited by:
Cited – The Children’s Investment Fund Foundation (UK) v Attorney General and Others ChD 9-Jun-2017
The court considered the propriety of a payment made by a charitable company to a director for her loss of office. The charity was to transfer a substantial sum to a new charity headed by the departing director.
Held: The court approved the . .
Cited – Lehtimaki and Others v Cooper SC 29-Jul-2020
Charitable Company- Directors’ Status and Duties
A married couple set up a charitable foundation to assist children in developing countries. When the marriage failed an attempt was made to establish a second foundation with funds from the first, as part of W leaving the Trust. Court approval was . .

Lists of cited by and citing cases may be incomplete.

Company

Updated: 30 December 2021; Ref: scu.546987

Reinhard v Ondra Llp and Others: ChD 14 Jan 2015

The parties disputed whether the claimant had become a member of the defendant limited liability partnership.
Warren J said: ‘the ‘share’ of a member [of an LLP] is the totality of the contractual or statutory rights and obligations of that member which attach to his membership’.

Warren J
[2015] EWHC 26 (Ch)
Bailii
England and Wales
Cited by:
Cited – Hosking v Marathon Asset Management Llp ChD 5-Oct-2016
Loss of agent’s share for breach within LLP
The court was asked whether the principle that a fiduciary (in particular, an agent) who acts in breach of his fiduciary duties can lose his right to remuneration, is capable of applying to profit share of a partner in a partnership or a member of a . .

Lists of cited by and citing cases may be incomplete.

Company, Contract

Updated: 25 December 2021; Ref: scu.541399

Cartesio Oktato es Szolgaltato bt: ECJ 16 Dec 2008

ECJ Grand Chamber – Transfer of a company seat to a Member State other than the Member State of incorporation ‘ Application for amendment of the entry regarding the company seat in the commercial register ‘ Refusal ‘ Appeal against a decision of a court entrusted with maintaining the commercial register ‘ Article 234 EC ‘ Reference for a preliminary ruling ‘ Admissibility Definition of ‘court or tribunal’ ‘ Definition of ‘a court or tribunal against whose decisions there is no judicial remedy under national law’ ‘ Appeal against a decision making a reference for a preliminary ruling Jurisdiction of appellate courts to order revocation of such a decision Freedom of establishment ‘ Articles 43 EC and 48 EC

V Skouris, P
[2009] 1 CMLR 50, [2009] Bus LR 1233, [2009] 3 WLR 777, [2009] BCC 232, [2009] Ch 354, [2009] All ER (EC) 269, [2008] EUECJ C-210/06
Bailii
European
Citing:
Opinion – Cartesio Oktato es Szolgaltato bt ECJ 22-May-2008
ECJ Freedom Of Establishment – Opinion – Reference for a preliminary ruling from the Szegedi Itel -‘tabla (Hungary) . .

Lists of cited by and citing cases may be incomplete.

Company

Updated: 24 December 2021; Ref: scu.540467

Multinational Gas and Petrochemical Co Ltd v Multinational Gas and Petrochemical Services Ltd: CA 1983

The court considered the way that the duty of a director to his company arose: ‘The directors indeed stand in a fiduciary relationship to the company, as they are appointed to manage the affairs of the company and they owe fiduciary duties to the company though not to the creditors, present or future, or to individual shareholders.’ The sole shareholder or the whole body of shareholders may approve a foolish or negligent decision in the ordinary course of business, at least where the company is solvent.

Dillon LJ
[1983] Ch 258
England and Wales
Cited by:
Cited – Ultraframe (UK) Ltd v Fielding and others ChD 27-Jul-2005
The parties had engaged in a bitter 95 day trial in which allegations of forgery, theft, false accounting, blackmail and arson. A company owning patents and other rights had become insolvent, and the real concern was the destination and ownership of . .
Cited – Prest v Petrodel Resources Ltd and Others SC 12-Jun-2013
In the course of ancillary relief proceedings in a divorce, questions arose regarding company assets owned by the husband. The court was asked as to the power of the court to order the transfer of assets owned entirely in the company’s names. The . .

Lists of cited by and citing cases may be incomplete.

Company, Trusts

Updated: 20 December 2021; Ref: scu.230278

Viho v Commission: ECJ 24 Oct 1996

[1996] ECR I-5457, C-73/95, [1996] EUECJ C-73/95P
Bailii
European
Cited by:
Cited – Scandecor Developments AB v Scandecor Marketing AV and Others and One Other Action HL 4-Apr-2001
A business had grown, but the two founders split, and set up separate business. There was no agreement as to the use of the trading names and trade marks. The original law of Trade Marks prohibited bare exclusive licenses, licences excluding the . .

Lists of cited by and citing cases may be incomplete.

European, Company

Updated: 18 December 2021; Ref: scu.161539

In Re A Company No 007816 of 1994, Same Re 007818, 007819, 007820, etc: ChD 13 Oct 1995

The company was said to have acted in breach of section 2(1) of the1982 Act.
Held: A Minister’s application to wind up companies in the public interest must be cogently argued. Insurance authorisation depends on where the effecting and carrying out of contracts of insurance occurs. The purpose of the addition of the words ‘as principal’, which had not appeared in earlier equivalent legislation, was to confirm that it did not extend to agents duly authorised by insurers.
That an insurance contract is made outside the UK does not mean that there cannot be the carrying on of an insurance business within the UK. Some activities conducted by brokers in the UK on behalf of offshore companies (other than the mere acceptance of risk) can amount to evidence that the offshore companies were carrying on business in the UK.

Times 13-Oct-1995, [1997] 2 BCLC 685
Companies Act 1986 124A, Insurance Companies Act 1982 2(1)
England and Wales

Company, Insurance

Updated: 18 December 2021; Ref: scu.81646

Marwaha and Others v Singh and Others: ChD 18 Feb 2013

The claimants sought injunctions and declaratory relief relating to: (a) a purported amendment to the constitution of the Guru Tegh Bahadur Gurdwara (‘the charity’); (b) the completion of a new list of members of the charity; and (c) for amendment of the scheme applicable to the charity so as to facilitate an election of a new executive committee for the charity.

Peling QC HHJ
[2013] EWHC B6 (Ch), [2013] PTSR D14
Bailii
England and Wales
Cited by:
Appeal from – Marwaha v Singh and Others CA 6-Nov-2013
. .

Lists of cited by and citing cases may be incomplete.

Charity, Company

Updated: 13 December 2021; Ref: scu.510168

Roadchef (Employee Benefits Trustees) Ltd v Hill and Another: ChD 29 Jan 2014

Challenge to share transfer.

Proudman J
[2014] EWHC 109 (Ch)
Bailii
England and Wales
Cited by:
Cited – Eclairs Group Ltd and Glengary Overseas Ltd v JKX Oil and Gas Plc SC 2-Dec-2015
Company Director not Trustee but is Fiduciary
The Court was asked about an alleged ‘corporate raid’, an attempt to exploit a minority shareholding in a company to obtain effective management or voting control without paying what other shareholders would regard as a proper price.
Held: The . .

Lists of cited by and citing cases may be incomplete.

Equity, Company

Updated: 29 November 2021; Ref: scu.520825

UBAF Ltd v European American Banking Corporation: CA 1984

The defendant invited the plaintiff to take part in a syndicated loan. The defendant’s assistant secretary signed a letter to the plaintiff making representations, now claimed to be fraudulent. The defendant succeeded at first instance arguing that the signature was not that of the bank, and that even if it was, the action would be statute barred.
Held: The court refused to strike out the claim. A company itself made a representation, if it produced a document which was signed by an authorised officer or agent acting within the scope of his actual authority. This applied to bind the defendant bank. The nature of a syndicated loan was a fiduciary arrangement, and the obligations on a lead bank were continuing for limitation purposes, time did not run, and the obligation was not time barred. The issue would be settled at trial when it was established when the defendant could be said to have come to know of the alleged deceit.

Ackner LJ
[1984] QB 713, [1984] 1 WLR 508, [1984] CLY 1579
England and Wales
Citing:
Explained – Swift v Jewsbury and Goddard 1874
. .
Explained – Hirst v West Riding Banking Co CA 1901
The representation on which the claim made was was in a letter signed by the branch manager of the defendant bank and the court evidently assumed that this could not be equated with the bank’s own signature.
Held: The action against the bank . .
Considered – Forster v Outred and Co CA 1981
A mother signed a mortgage deed charging her property to H as security for a loan to her son. She claimed the solicitor had been negligent in his advice. The solicitor replied that the claim was out of time. The loss accrued not when demand for . .

Cited by:
Cited – Nykredit Mortgage Bank Plc v Edward Erdman Group Ltd (No 2) HL 27-Nov-1997
A surveyor’s negligent valuation had led to the plaintiff obtaining what turned out to be inadequate security for his loan. A cause of action against a valuer for his negligent valuation arises when a relevant and measurable loss is first recorded. . .
Cited – Pegasus Management Holdings Sca and Another v Ernst and Young (A Firm) and Another ChD 11-Nov-2008
The claimants alleged professional negligence in advice given by the defendant on a share purchase, saying that it should have been structured to reduce Capital Gains Tax. The defendants denied negligence and said the claim was statute barred.
Banking, Limitation, Torts – Other, Company

Updated: 29 November 2021; Ref: scu.181338

Bell v Lever Brothers Ltd: HL 15 Dec 1931

Contract – Mutual Mistake Test

Bell was director and chairman of Niger, a subsidiary of Lever Brothers Ltd who dismissed him, offering and paying pounds 30,000 compensation. Lever then discovered that Mr Bell had made secret profits at the expense of Niger for which he could have been summarily dismissed. Lever sought repayment of the pounds 30,000 and claimed rescission of the agreement for fraud. The jury found that there was no fraud, but if Lever had known of the dealings giving rise to the secret profits, it would not have paid compensation. Before the trial, Bell admitted his liability to account to Niger for his secret profits, and made a payment into court.
Held: The court laid down the test for identifying a mutual mistake in contract allowing the contract to be declared void.
The mistake must render the subject matter of the contract essentially and radically different from the subject matter which the parties believed to exist. Was it the common assumption or pre-condition upon which the compromise agreement was made? The House asked whether there was a positive duty on the part of Bell and Snelling to disclose the breaches of contract they made. Lord Atkin concluded they had no such duty, saying of Healey: ‘It will be notice that Bell was not a director of Levers and with respect I cannot accept the view of Greer LJ that if he was in a fiduciary relationship with the Niger Company he was in a similar fiduciary relationship with the share holders’.
Lord Thankerton: ‘in the absence of fraud . . I am of the opinion that neither a servant nor a director of a company is legally bound forthwith to disclose any breach of the obligations arising out of the relationship so as to give the master or the company the opportunity of dismissal . . ‘ However, he also said, ‘there may well be case where the concealment of the misconduct amounts to a fraud on the master or company . . ‘
Lord Atkin considered the possible duty of disclosure of an intending partner: ‘Fraudulent concealment has been negatived by the jury; this claim is based upon the contention that Bell owed a duty to Levers to disclose his misconduct, and that in default of disclosure the contract was voidable. Ordinarily the failure to disclose a material fact which might influence the mind of a prudent contractor does not give the right to avoid the contract. The principle of caveat emptor applies outside contracts of sale. There are certain contracts expressed by the law to be contracts of the utmost good faith, where material facts must be disclosed; if not, the contract is voidable. Apart from special fiduciary relationships, contracts for partnership and contracts of insurance are the leading instances. In such cases the duty does not arise out of contract; the duty of a person proposing an insurance arises before a contract is made, so of an intending purchaser.’

Atkin L, Lord Thankerton, Lord Blanesburgh
[1932] AC 161, [1931] UKHL 2
Bailii
England and Wales
Citing:
Dictum approved – Healey v Societe Anonyme Francais Rubastic 1917
A director of the company claimed arrears of salary for work done notwithstanding that he had been summarily dismissed for misconduct. There was no question of a claim for damages for breach of duty. . .
Appeal from – Bell v Lever Brothers Ltd CA 1931
The court was asked as to the duties of a company director: ‘It does not seem to me open to question that the directors of a company occupy a fiduciary position towards the company, with the result that they cannot retain a benefit they have . .
Approved – London and Mashonaland Exploration Co Ltd v New Mashonaland Exploration Co Ltd 1891
There is nothing inherently objectionable in the position of a company director (and chairman) who, without breaching any express restrictive agreement or disclosing any confidential information, becomes engaged, whether personally or as a director . .

Cited by:
Confirmed – Great Peace Shipping Ltd v Tsavliris (International) Ltd CA 14-Oct-2002
The parties contracted for the hire of a ship. They were each under a mistaken impression as to its position, and a penalty became payable. The hirer claimed that the equitable doctrine of mutual mistake should forgive him liability.
Held: . .
Cited – William Sindall Plc v Cambridgeshire County Council CA 21-May-1993
Land was bought for development, but the purchaser later discovered a sewage pipe which very substantially limited its development potential. The existence of the pipe had not been disclosed on the sale, being unknown to the seller.
Held: . .
Cited – Associated Japanese Bank (International) Ltd v Credit du Nord SA 1988
A contract of guarantee was made, but based upon a term of fundamental importance which was mistaken as to the existence of certain machines.
Held: The court must first look to the nature of the purported agreement. Steyn J said: ‘Logically, . .
Distinguished – Horcal Ltd v Gatland ChD 1983
Directors have a positive duty to disclose breaches of fiduciary duty. A failure by a director of a company, as opposed to an employee, to disclose an earlier breach of fiduciary duty would render an agreement terminating his contract of service (on . .
Cited – Horcal Ltd v Gatland CA 1984
The court considered the arguments presented as to the duty of a director of a company to disclose his own breach of fiduciary duty: ‘Counsel . . submitted, as a general proposition, that, putting fraud on one side, there is no general duty on . .
Cited – EIC Services Ltd European Internet Capital Ltd v Phipps, Paul, Barber CA 30-Jul-2004
Whether issue of additional shares had been properly authorised . .
Cited – Item Software (UK) Ltd v Fassihi and Others ChD 5-Dec-2002
Enforcement of confidentiality clause in contract of employment on termination. . .
Cited – Fassihim, Liddiardrams, International Ltd, Isograph Ltd v Item Software (UK) Ltd CA 30-Sep-2004
The first defendant (F) had been employed by a company involved in a distribution agreement. He had sought to set up a competing arrangement whilst a director of the claimant, and diverted a contract to his new company.
Held: A company . .
Mentioned – Ultraframe (UK) Ltd v Fielding and others ChD 27-Jul-2005
The parties had engaged in a bitter 95 day trial in which allegations of forgery, theft, false accounting, blackmail and arson. A company owning patents and other rights had become insolvent, and the real concern was the destination and ownership of . .
Cited – Halpern and Another v Halpern and others ComC 24-Mar-2006
The deceased parents, being orthodox Jews, had first made standard wills and then made provision accoding to Jewish law. A dispute after the second death was referred to a Beth Din arbitration. After an initial resolution, various distributions were . .
mentioned – Islington v Uckac and Another CA 30-Mar-2006
The council’s tenant had unlawfully secured assignment of a secure tenancy to the defendant. The council sought possession.
Held: A secure tenancy granted by an authority pursuant to a misrepresentation by the tenant is nonetheless valid. The . .
Cited – Simms v Conlon and Another CA 20-Dec-2006
Solicitors within a practice sued each other, and one wished to plead the fact of a finding of professional misconduct.
Held: The defendant’s appeal succeeded. It was not an abuse for the appellant to continue to assert his innocence, and the . .
Cited – Graves v Graves and others CA 3-Jul-2007
The parties had divorced and settled financial provision, but the former wife and her children came to need a house and one of the claimant’s properties became vacant, and she was allowed to occupy it as a tenant, with the majority of the rent being . .
Cited – Butters and Others v BBC Worldwide Ltd and Others ChD 20-Aug-2009
In the insolvency of Woolworths plc, a subsidiary sought to have valued its shareholding in a company in which the defendants were co-shareholders. It was argued that an earlier agreement between them had not be fully superceded by a subsequent one. . .
Cited – Helmet Integrated Systems Ltd v Tunnard and others CA 15-Dec-2006
Whilst employed by the claimants as a salesman, the defendant came to want to develop his idea for a modular helmet suitable for fire-fighters and others. He took certain steps including showing the proposal confidentially to a competitor, and then . .
Cited – Balston Ltd v Headline Filters Ltd and Another ChD 1990
The claimant, a manufacturer of filter tubes, employed the defendant as a director. He gave notice to leave, but during his notice period, he was contacted by a customer who informed him of a meeting between that customer and the company at which . .
Cited – Lehman Brothers International (Europe) v Exotix Partners Llp ChD 9-Sep-2019
The parties had contracted to trade global depository notes issued by the Peruvian government. Each made mistakes as to their true value, thinking them scraps worth a few thousand dollars, whereas their true value was over $8m. On the defendant . .

Lists of cited by and citing cases may be incomplete.

Contract, Company

Leading Case

Updated: 29 November 2021; Ref: scu.181343

Ackerman v Ackerman and Others: ChD 12 Aug 2011

The parties disputed the division of assets within a group of companies.

Roth J
[2011] EWHC 2183 (Ch)
Bailii
England and Wales
Cited by:
Cited – MG v AR FD 16-Nov-2021
Family Case: Costs Security depends on Case Merits
Application for security for costs in family cases.
Held: In contrast to civil cases generally, in a family case the merits of the application and the strength of the defence necessarily have to be carefully considered. It is only by . .

Lists of cited by and citing cases may be incomplete.

Company, Costs

Updated: 22 November 2021; Ref: scu.442740