Miss
I Fit Global Ltd, Re
Blunt v Jackson
Chancery Division (Companies Court)
17 July 2013
Case Analysis
Where Reported
[2013] EWHC 2090 (Ch.); Case Digest
Subject: Company law
Other related subjects: Partnerships
Keywords: Dividends; Exclusion; Shareholders; Unfairly prejudicial conduct
Summary: The dismissal of a director of a company constituted exclusion from the company that was unfair and prejudicial to his interests as a shareholder under the Companies Act 2006 s.994.
Abstract: The court was required to determine two preliminary issues in relation to an unfair prejudice petition presented by the petitioner (B). B, and the first respondent (X), had incorporated a company (F) in April 2010 to import weight loss machines and were its initial directors. From the outset, B was employed by F on a modest salary. In November 2011, B was dismissed and removed as a director of F, which ceased trading about May 2012. During F's trading, there had been an almost complete disregard of the statutory and formal requirements for the operation of a limited company. B's primary complaint in presenting the substantive unfair prejudice petition was that he had been excluded from the company from the time of his dismissal, though he had entered into a partnership with X on F's incorporation on the understanding that each were to be equal shareholders. X denied that B had been a shareholder at all, despite an annual return splitting F's shareholding equally between B, X and the second respondent (Y), and a subsequent annual return stating that all of F's shares had been transferred to X. In support of his shareholding claim, B relied on tax returns in which he had declared dividends from the shares he held in F. The issues were whether (i) B had been a shareholder in F; (ii) the grounds complained of in the unfair prejudice petition were grounds for an order under the Companies Act 2006 s.994.
Preliminary issues determined. (1) B and X had agreed on the basis of
Blunt v Jackson
Chancery Division (Companies Court)
17 July 2013
Case Analysis
Where Reported
[2013] EWHC 2090 (Ch.); Case Digest
Subject: Company law
Other related subjects: Partnerships
Keywords: Dividends; Exclusion; Shareholders; Unfairly prejudicial conduct
Summary: The dismissal of a director of a company constituted exclusion from the company that was unfair and prejudicial to his interests as a shareholder under the Companies Act 2006 s.994.
Abstract: The court was required to determine two preliminary issues in relation to an unfair prejudice petition presented by the petitioner (B). B, and the first respondent (X), had incorporated a company (F) in April 2010 to import weight loss machines and were its initial directors. From the outset, B was employed by F on a modest salary. In November 2011, B was dismissed and removed as a director of F, which ceased trading about May 2012. During F's trading, there had been an almost complete disregard of the statutory and formal requirements for the operation of a limited company. B's primary complaint in presenting the substantive unfair prejudice petition was that he had been excluded from the company from the time of his dismissal, though he had entered into a partnership with X on F's incorporation on the understanding that each were to be equal shareholders. X denied that B had been a shareholder at all, despite an annual return splitting F's shareholding equally between B, X and the second respondent (Y), and a subsequent annual return stating that all of F's shares had been transferred to X. In support of his shareholding claim, B relied on tax returns in which he had declared dividends from the shares he held in F. The issues were whether (i) B had been a shareholder in F; (ii) the grounds complained of in the unfair prejudice petition were grounds for an order under the Companies Act 2006 s.994.
Preliminary issues determined. (1) B and X had agreed on the basis of