High Court Shareholder Dispute Case Success for JCP Solicitors

JCP Solicitors’ Commercial Litigation team, jointly led by Andrew Meech, has successfully acted for the Petitioners in a High Court shareholder dispute involving a group of businesses operating in the rail and construction sectors.

The Case Details

Concerning a fallout between shareholders over the management and future of the company, the case centred on whether the Petitioners had been unfairly shut out of the company and whether decisions taken by the Respondents were unfair and prejudicial to the interests of them as shareholders.

Heard before His Honour Judge Jarman KC, sitting as a judge of the High Court, the ruling found that the Petitioners had been unfairly excluded from the management of the company. It also found that the setting up of a competing business, and related actions, contributed to the unfair and prejudicial conduct.

The Case Result

As a result, the Court decided that the right outcome was for the Petitioners’ shareholding to be bought at a fair value.

The judgment followed a six-day unfair prejudice trial in which barristers Richard Ascroft and Zachariah Pullar, both of Guildhall Chambers and instructed by Andrew Meech of JCP Solicitors, acted for the successful Petitioners. The relief included a share purchase order based on a seven-figure valuation of the relevant shares.

Why The Case Is Significant for Businesses

One of the key issues of the case – and what makes it relevant for businesses – was the distinction between personal behaviour of the directors/shareholders and conduct that relates to the affairs of the company.

Notably, the case also considered whether allegations about the First Petitioner’s personal conduct could justify excluding him from the business. In its decision, the Court examined the difference between personal behaviour and conduct that can be said to amount to conduct of the affairs of a company.

Andrew Meech, Director and Joint Head of Commercial Litigation at JCP Solicitors, said: “Cases like this are about more than legal arguments. They are about people, businesses and the consequences when working relationships break down.

“This outcome highlights the protection available to shareholders when they are unfairly excluded from the businesses they helped to build, and the practical remedies (coupled with its wide discretion) the Court can order. The judgment shows the importance of acting fairly, being open in the way a business is run, and taking proper advice at an early stage when disputes between shareholders begin to develop.”

Find Professional Advice

For specialist legal advice and guidance on shareholder disputes and commercial litigation, JCP Solicitors can help. To speak to an expert, contact Andrew Meech, Director and Joint Head of Commercial Litigation, by calling 01792 525419 or emailing andrew.meech@jcpsolicitors.co.uk.