Bhullar & Ors v Bhullar & Anor

Bhullar & Ors v Bhullar & Anor

The directors breached their fiduciary duty by acquiring for themselves a property that was a business opportunity closely associated with the company's activities, creating a real sensible possibility of conflict between their personal interests and their duties to the company. The opportunity should have been disclosed to the company, and the directors are accountable for the acquisition.

Parties
Petitioners/respondents: Mohan Singh Bhullar & Ors; Respondents/appellants: Inderjit Singh Bhullar & Anor
Jurisdiction
England and Wales
Judgment Date
31 March 2003
Procedural Posture
Civil Appeal / Appeal From High Court Judgment
Outcome
Appeal dismissed
Legal Topics
Directors' Fiduciary Duties, Conflict of Interest, Constructive Trust, Unfair Prejudice in Company Management
Company Law Equity Directors' Fiduciary Duties Conflict of Interest Constructive Trust Unfair Prejudice in Company Management

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Parties

Mohan Singh Bhullar & Ors

Petitioners/respondents

Inderjit Singh Bhullar & Anor

Respondents/appellants

Procedural Posture

Civil Appeal / Appeal From High Court Judgment

Legal Issues

  1. 1 Whether directors breached fiduciary duty by acquiring a property for themselves that could have been of interest to the company
  2. 2 Whether the acquisition of the property created a real sensible possibility of conflict between directors' personal interests and their duties to the company

Ratio Decidendi

The directors breached their fiduciary duty by acquiring for themselves a property that was a business opportunity closely associated with the company's activities, creating a real sensible possibility of conflict between their personal interests and their duties to the company. The opportunity should have been disclosed to the company, and the directors are accountable for the acquisition.

Court Disposition

Appeal dismissed

Orders

  • Silvercrest Trading (GB) Ltd holds the property on trust for Bhullar Bros Ltd
  • Appellants to procure transfer of the property to Bhullar Bros Ltd at the price paid