Ceredigion Recycling And Furniture Team v Pope & Ors [2022] EWHC 1969 (Ch) (26 July 2022)

Ceredigion Recycling And Furniture Team v Pope & Ors [2022] EWHC 1969 (Ch) (26 July 2022)

The appropriate relief for the directors' breach of fiduciary duty and conversion of company property is restoration of the property to the company and judgment for the rental payments made, plus interest and costs. The directors are not entitled to set off hypothetical remuneration or pension contributions, as the...

Source-derived case information.

Citation
[2022] EWHC 1969 (Ch)
Parties
Claimant: Ceredigion Recycling and Furniture Team; First Defendant: Derek Clifford Pope; Second Defendant: Allison Cann; Third Defendant: Cyfri Cyfrifwr Cyfyngedig; Fourth Defendant: Cyfri Cyfyngedig; Fifth Defendant: SLA Property Company Limited; Sixth Defendant: Suffolk Life Annuities Limited
Jurisdiction
England and Wales
Judgment Date
26 July 2022
Procedural Posture
Chancery (business and Property Courts) / Disposal Hearing on Relief After Liability Judgment and Appeal
Outcome
Judgment for claimant; restorative relief granted
Legal Topics
Directors' Fiduciary Duties, Breach of Trust, Equitable Compensation, Ultra Vires Acts, Constructive Trust, Restorative Relief, Account of Profits
Company Law Equity and Trusts Directors' Fiduciary Duties Breach of Trust Equitable Compensation Ultra Vires Acts Constructive Trust Restorative Relief +1 more

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Parties

Ceredigion Recycling and Furniture Team

Claimant

Derek Clifford Pope

First Defendant

Allison Cann

Second Defendant

Cyfri Cyfrifwr Cyfyngedig

Third Defendant

Cyfri Cyfyngedig

Fourth Defendant

SLA Property Company Limited

Fifth Defendant

Suffolk Life Annuities Limited

Sixth Defendant

Procedural Posture

Chancery (business and Property Courts) / Disposal Hearing on Relief After Liability Judgment and Appeal

Legal Issues

  1. 1 What is the appropriate relief for breach of fiduciary duty by directors who converted company property for personal benefit?
  2. 2 Are the directors entitled to credit for hypothetical lawful remuneration or pension contributions?
  3. 3 How should settlement sums from professional advisers be treated in the relief calculation?

Ratio Decidendi

The appropriate relief for the directors' breach of fiduciary duty and conversion of company property is restoration of the property to the company and judgment for the rental payments made, plus interest and costs. The directors are not entitled to set off hypothetical remuneration or pension contributions, as the scheme was ultra vires and no evidence supports lawful entitlement. The settlement sum from professional advisers is to be credited as agreed.

Court Disposition

Judgment for claimant; restorative relief granted

Orders

  • Property to be transferred back to the company so lease merges with freehold
  • Judgment against Mr Pope and Ms Cann for rental payments made plus interest