Singh Brothers Contractors (North West) Ltd, Re

Singh Brothers Contractors (North West) Ltd, Re

Permission to continue the derivative claim is refused because the conduct complained of was either authorised by the company before it occurred or has been ratified by the company since. The payments of dividends and remuneration were approved by the directors and shareholders, who were the same individuals. No director acting in accordance with section 172 would seek to continue the claim. The claimant’s motivation is animosity arising from a family dispute, not the company’s best interests. Alternative remedies are available to the claimant.

Parties
Claimant: Sukhpaul Singh; First Defendant: Satpaul Singh; Second Defendant: Singh Brothers Contractors (North West) Limited
Jurisdiction
England and Wales
Judgment Date
27 June 2013
Procedural Posture
Derivative Claim / Application for Permission to Continue Derivative Claim
Outcome
Permission to continue derivative claim refused
Legal Topics
Derivative Claims, Directors' Duties, Breach of Fiduciary Duty, Breach of Trust, Remuneration, Dividends, Ratification, Limitation
Company Law Derivative Claims Directors' Duties Breach of Fiduciary Duty Breach of Trust Remuneration Dividends Ratification +1 more

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Parties

Sukhpaul Singh

Claimant

Satpaul Singh

First Defendant

Singh Brothers Contractors (North West) Limited

Second Defendant

Procedural Posture

Derivative Claim / Application for Permission to Continue Derivative Claim

Legal Issues

  1. 1 Whether permission should be granted to continue a derivative claim under section 261 of the Companies Act 2006
  2. 2 Whether the acts complained of were authorised or ratified by the company
  3. 3 Whether the claimant is acting in good faith

Ratio Decidendi

Permission to continue the derivative claim is refused because the conduct complained of was either authorised by the company before it occurred or has been ratified by the company since. The payments of dividends and remuneration were approved by the directors and shareholders, who were the same individuals. No director acting in accordance with section 172 would seek to continue the claim. The claimant’s motivation is animosity arising from a family dispute, not the company’s best interests. Alternative remedies are available to the claimant.

Court Disposition

Permission to continue derivative claim refused

Orders

  • Permission to continue the derivative claim is refused