Estera Trust (Jersey) Ltd & Anor v Singh & Ors [2018] EWHC 1715 (Ch) (05 July 2018)

Estera Trust (Jersey) Ltd & Anor v Singh & Ors [2018] EWHC 1715 (Ch) (05 July 2018)

The court found that the company was not a quasi-partnership at the relevant times, as there was no binding mutual understanding entitling Herinder Singh to participate in management; the removal of Herinder Singh as director and employee was not unfairly prejudicial; there was no actionable breach of fiduciary duty by Jasminder Singh in relation to Winchfern and Expotel; and the remuneration paid to Jasminder Singh, while high, did not amount to unfair prejudice in the absence of a binding dividend policy or quasi-partnership rights.

Citation
[2018] EWHC 1715 (Ch)
Parties
First Petitioner: Estera Trust (Jersey) Limited (formerly Appleby Trust (Jersey) Limited); Second Petitioner: Herinder Singh; First Respondent: Jasminder Singh; Second Respondent: Verite Trust Company Limited; Third Respondent: Jemma Trust Company Limited; Fourth Respondent: Edwardian Group Limited; Fifth Respondent: Jasminder Singh and Herinder Singh (as trustees of the English Trusts)
Jurisdiction
England and Wales
Judgment Date
05 July 2018
Procedural Posture
Unfair Prejudice Petition Under Companies Act 2006 S.994 / First Instance Judgment
Outcome
Petition dismissed
Legal Topics
Unfair Prejudice, Quasi Partnership, Breach of Fiduciary Duty, Shareholder Remedies, Directors' Duties, Remuneration, Removal of Director
Company Law Equity and Trusts Unfair Prejudice Quasi Partnership Breach of Fiduciary Duty Shareholder Remedies Directors' Duties Remuneration +1 more

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Parties

Estera Trust (Jersey) Limited (formerly Appleby Trust (Jersey) Limited)

First Petitioner

Herinder Singh

Second Petitioner

Jasminder Singh

First Respondent

Verite Trust Company Limited

Second Respondent

Jemma Trust Company Limited

Third Respondent

Edwardian Group Limited

Fourth Respondent

Jasminder Singh and Herinder Singh (as trustees of the English Trusts)

Fifth Respondent

Procedural Posture

Unfair Prejudice Petition Under Companies Act 2006 S.994 / First Instance Judgment

Legal Issues

  1. 1 Whether the affairs of Edwardian Group Limited were conducted in a manner unfairly prejudicial to the petitioners' interests as members under s.994 Companies Act 2006
  2. 2 Whether the company was a quasi-partnership giving rise to equitable rights for participation in management
  3. 3 Whether Jasminder Singh breached fiduciary duties regarding corporate opportunities (Winchfern and Expotel)

Ratio Decidendi

The court found that the company was not a quasi-partnership at the relevant times, as there was no binding mutual understanding entitling Herinder Singh to participate in management; the removal of Herinder Singh as director and employee was not unfairly prejudicial; there was no actionable breach of fiduciary duty by Jasminder Singh in relation to Winchfern and Expotel; and the remuneration paid to Jasminder Singh, while high, did not amount to unfair prejudice in the absence of a binding dividend policy or quasi-partnership rights.

Court Disposition

Petition dismissed