Gibbins v Tierney & Ors [2024] EWHC 2004 (Ch) (01 August 2024)

Gibbins v Tierney & Ors [2024] EWHC 2004 (Ch) (01 August 2024)

The respondents' exclusion of the petitioner from management, misapplication of company funds, and diversion of business constituted unfair prejudice under s.994 Companies Act 2006, justifying an order for the respondents to purchase the petitioner's shares at fair value as at 1 August 2020 with no minority discount.

Citation
[2024] EWHC 2004 (Ch)
Parties
Petitioner: Sally Ann Gibbins; First Respondent: John Peter Francis Tierney; Second Respondent: Rose Anna Brown; Third Respondent: PHB Ethical Beauty Limited
Jurisdiction
England and Wales
Judgment Date
01 August 2024
Procedural Posture
Unfair Prejudice Petition Under Companies Act 2006 S.994 / Uncontested Trial on Liability and Relief
Outcome
Petition allowed; order for buy-out of petitioner's shares at fair value as at 1 August 2020 with no minority discount; costs awarded to petitioner.
Legal Topics
Unfair Prejudice, Quasi Partnership, Shareholder Rights, Director Duties, Remedies Under Companies Act 2006
Company Law Equity Unfair Prejudice Quasi Partnership Shareholder Rights Director Duties Remedies Under Companies Act 2006

Case Brief

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Parties

Sally Ann Gibbins

Petitioner

John Peter Francis Tierney

First Respondent

Rose Anna Brown

Second Respondent

PHB Ethical Beauty Limited

Third Respondent

Procedural Posture

Unfair Prejudice Petition Under Companies Act 2006 S.994 / Uncontested Trial on Liability and Relief

Legal Issues

  1. 1 Whether the affairs of PHB Ethical Beauty Limited were conducted in a manner unfairly prejudicial to the petitioner under s.994 Companies Act 2006
  2. 2 Whether the petitioner was unfairly excluded from management
  3. 3 Whether company assets were misapplied by the respondents

Ratio Decidendi

The respondents' exclusion of the petitioner from management, misapplication of company funds, and diversion of business constituted unfair prejudice under s.994 Companies Act 2006, justifying an order for the respondents to purchase the petitioner's shares at fair value as at 1 August 2020 with no minority discount.

Court Disposition

Petition allowed; order for buy-out of petitioner's shares at fair value as at 1 August 2020 with no minority discount; costs awarded to petitioner.

Orders

  • First and Second Respondents to purchase Petitioner's shares in PHB Ethical Beauty Limited at fair value as at 1 August 2020 with no minority discount.
  • Valuation to be on a willing buyer/willing seller basis, as a going concern, taking into account assets, goodwill, profitability, and future prospects as at 1 August 2020.