Unfair Prejudice in United Kingdom Company Law - Court Remedies

Court Remedies

“
s.996 Powers of the court under this Part

(1) If the court is satisfied that a petition under this Part is well founded, it may make such order as it thinks fit for giving relief in respect of the matters complained of.

(2) Without prejudice to the generality of subsection (1), the court’s order may—

(a) regulate the conduct of the company’s affairs in the future;
(b) require the company—
(i) to refrain from doing or continuing an act complained of, or
(ii) to do an act that the petitioner has complained it has omitted to do;
(c) authorise civil proceedings to be brought in the name and on behalf of the company by such person or persons and on such terms as the court may direct;
(d) require the company not to make any, or any specified, alterations in its articles without the leave of the court;
(e) provide for the purchase of the shares of any members of the company by other members or by the company itself and, in the case of a purchase by the company itself, the reduction of the company’s capital accordingly.
 ”

The typical award made is for a minority shareholder's shares to be purchased at a fair value.

  • Fulham Football Club (1987) Ltd v Richards EWCA Civ 855, an unfair prejudice petition was stayed under the Arbitration Act 1996 s 9, given that the dispute was covered by an arbitration agreement.

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