Homes of England Ltd v Horsham Holdings Ltd & Ors

Homes of England Ltd v Horsham Holdings Ltd & Ors

The Petitioner established serious issues to be tried regarding the existence and authorisation of the alleged loan, possible breach of the shareholders' agreement, and directors' duties. However, the balance of convenience and least risk of injustice did not favour an outright injunction due to potential prejudice to the Respondents and inadequacy of the Petitioner's undertaking in damages. The appropriate course was to permit payment upon provision of indemnities by the relevant Respondents to protect the Petitioner's position if the payment is later found unlawful.

Parties
Petitioner: Homes of England Limited; First Respondent: Horsham Holdings Limited; Second Respondent: DNG Holdings Bedford Limited; Third Respondent: North Street Horsham Development LLP; Fourth Respondent: Davidia Properties Limited; Fifth Respondent: DNG Bedford Properties Limited; Sixth Respondent: DNG Bedford Properties (3) Limited; Seventh Respondent: Oxford Property Investments Limited; Eighth Respondent: Nick Sellman (Holdings) Limited; Ninth Respondent: Mr Anthony Simon Christofis; Tenth Respondent: Mr Shaun Terence Savage; Eleventh Respondent: Mr Nicholas James Sellman; Twelfth Respondent: Mr Matthew John Williams
Jurisdiction
England and Wales
Judgment Date
04 May 2020
Procedural Posture
Company/shareholder Petition / Interlocutory Application for Interim Injunction
Outcome
Application for interim injunction refused in its original form; conditional order granted
Legal Topics
Shareholder Disputes, Interim Injunctions, Directors' Duties, Minority Shareholder Protection, Section 994 Companies Act 2006, Inter Company Loans, Breach of Shareholders' Agreement
Company Law Equity Civil Procedure Shareholder Disputes Interim Injunctions Directors' Duties Minority Shareholder Protection Section 994 Companies Act 2006 +2 more

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Parties

Homes of England Limited

Petitioner

Horsham Holdings Limited

First Respondent

DNG Holdings Bedford Limited

Second Respondent

North Street Horsham Development LLP

Third Respondent

Davidia Properties Limited

Fourth Respondent

DNG Bedford Properties Limited

Fifth Respondent

DNG Bedford Properties (3) Limited

Sixth Respondent

Oxford Property Investments Limited

Seventh Respondent

Nick Sellman (Holdings) Limited

Eighth Respondent

Mr Anthony Simon Christofis

Ninth Respondent

Mr Shaun Terence Savage

Tenth Respondent

Mr Nicholas James Sellman

Eleventh Respondent

Mr Matthew John Williams

Twelfth Respondent

Procedural Posture

Company/shareholder Petition / Interlocutory Application for Interim Injunction

Legal Issues

  1. 1 Whether the Petitioner is entitled to an interim injunction restraining payment of £500,000 by the First Respondent to other Respondents or third parties
  2. 2 Whether the alleged loan of £500,000 exists and was properly authorised
  3. 3 Whether payment would breach the shareholders' agreement or directors' duties

Ratio Decidendi

The Petitioner established serious issues to be tried regarding the existence and authorisation of the alleged loan, possible breach of the shareholders' agreement, and directors' duties. However, the balance of convenience and least risk of injustice did not favour an outright injunction due to potential prejudice to the Respondents and inadequacy of the Petitioner's undertaking in damages. The appropriate course was to permit payment upon provision of indemnities by the relevant Respondents to protect the Petitioner's position if the payment is later found unlawful.

Court Disposition

Application for interim injunction refused in its original form; conditional order granted

Orders

  • The Respondents may procure the First Respondent to make the intended payment to the Redwood Partnership upon provision of indemnities by the Fifth, Sixth, and Ninth to Twelfth Respondents to the Petitioner against any loss if the payment is later found unlawful.
  • The court will hear counsel as to the terms of the order and any consequential orders as to costs.