Dinglis v Dinglis & Ors

Dinglis v Dinglis & Ors

Petitioner's 12% minority shareholding in Dinglis Properties Limited is to be valued as at 25 July 2019 (date of buy-out order), subject to a minority discount and adjustments for losses caused by Respondent's unfairly prejudicial conduct, including misuse of company funds, with further factual determination at valuation trial; historic basis of shareholding and financial risks undertaken by Petitioner do not justify departure from minority discount, but special purchaser value may be considered.

Parties
Petitioner: Paul Dinglis; First Respondent: Andreas Dinglis; Second Respondent: Master Holdings Group Limited; Third Respondent: Dinglis Properties Limited
Jurisdiction
England and Wales
Judgment Date
05 December 2019
Procedural Posture
Unfair Prejudice Petition Under Companies Act 2006 / Post Liability Judgment, Determination of Valuation and Adjustments
Outcome
Petitioner's claim for unfair prejudice succeeded; order for Respondents to acquire Petitioner's shares at determined value, subject to minority discount and adjustments.
Legal Topics
Unfair Prejudice, Shareholder Remedies, Valuation of Minority Shareholding, Minority Discount, Directors' Duties, Section 172 Companies Act 2006, Adjustment for Prejudicial Conduct
Company Law Equity Unfair Prejudice Shareholder Remedies Valuation of Minority Shareholding Minority Discount Directors' Duties Section 172 Companies Act 2006 +1 more

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Parties

Paul Dinglis

Petitioner

Andreas Dinglis

First Respondent

Master Holdings Group Limited

Second Respondent

Dinglis Properties Limited

Third Respondent

Procedural Posture

Unfair Prejudice Petition Under Companies Act 2006 / Post Liability Judgment, Determination of Valuation and Adjustments

Legal Issues

  1. 1 What is the appropriate valuation date for the Petitioner's shares?
  2. 2 Which proposed adjustments to share value should proceed to valuation trial?
  3. 3 What is the correct approach to calculation of the minority discount?

Ratio Decidendi

Petitioner's 12% minority shareholding in Dinglis Properties Limited is to be valued as at 25 July 2019 (date of buy-out order), subject to a minority discount and adjustments for losses caused by Respondent's unfairly prejudicial conduct, including misuse of company funds, with further factual determination at valuation trial; historic basis of shareholding and financial risks undertaken by Petitioner do not justify departure from minority discount, but special purchaser value may be considered.

Court Disposition

Petitioner's claim for unfair prejudice succeeded; order for Respondents to acquire Petitioner's shares at determined value, subject to minority discount and adjustments.

Orders

  • Petitioner's 12% shareholding in Dinglis Properties Limited to be acquired by First and/or Second Respondents as at 25 July 2019.
  • Valuation to be subject to minority discount and adjustments for losses caused by unfairly prejudicial conduct.