LAWRENCE EWAN MCGAUGHEY & Anor v UNIVERSITIES SUPERANNUATION SCHEME LIMITED & Ors

LAWRENCE EWAN MCGAUGHEY & Anor v UNIVERSITIES SUPERANNUATION SCHEME LIMITED & Ors

The claimants lacked standing to bring a multiple derivative claim because they failed to show reflective loss or a sufficient interest; no prima facie case was established that the directors committed deliberate/dishonest breaches of duty or improperly benefitted themselves; the claims did not fall within the fourth exception to Foss v Harbottle; and alternative remedies were available for discrimination and other alleged breaches.

Parties
Claimant: Lawrence Ewan McGaughey; Claimant: Neil Martin Davies; First Defendant: Universities Superannuation Scheme Limited; Second Defendants: Individuals listed in Appendix 1 to the Claim Form; Third Defendants: Individuals listed in Appendix 2 to the Claim Form
Jurisdiction
England and Wales
Judgment Date
24 May 2022
Procedural Posture
Derivative Claim (multiple Derivative Action) / Application for Permission to Continue Claim; Judgment on Permission
Outcome
Application for permission to continue the multiple derivative claim dismissed; application for prospective costs order refused.
Legal Topics
Derivative Actions, Directors' Duties, Fiduciary Duties, Statutory Funding Objective, Discrimination (equality Act 2010), Reflective Loss, Scheme Governance, Investment Duties, Remuneration and Costs, Climate Change and ESG Investing
Company Law Pensions Law Trust Law Employment Law Equality Law Derivative Actions Directors' Duties Fiduciary Duties +7 more

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Parties

Lawrence Ewan McGaughey

Claimant

Neil Martin Davies

Claimant

Universities Superannuation Scheme Limited

First Defendant

Individuals listed in Appendix 1 to the Claim Form

Second Defendants

Individuals listed in Appendix 2 to the Claim Form

Third Defendants

Procedural Posture

Derivative Claim (multiple Derivative Action) / Application for Permission to Continue Claim; Judgment on Permission

Legal Issues

  1. 1 Whether claimants have standing to bring a multiple derivative claim on behalf of a company limited by guarantee (pension scheme trustee)
  2. 2 Whether the pleaded breaches of duty by directors fall within the fourth exception to the rule in Foss v Harbottle (fraud on the minority)
  3. 3 Whether the directors committed deliberate/dishonest breaches of duty or improperly benefitted themselves

Ratio Decidendi

The claimants lacked standing to bring a multiple derivative claim because they failed to show reflective loss or a sufficient interest; no prima facie case was established that the directors committed deliberate/dishonest breaches of duty or improperly benefitted themselves; the claims did not fall within the fourth exception to Foss v Harbottle; and alternative remedies were available for discrimination and other alleged breaches.

Court Disposition

Application for permission to continue the multiple derivative claim dismissed; application for prospective costs order refused.

Orders

  • Permission to continue all four claims refused
  • Application for prospective costs order refused