Brewin & Anor v Bathroom Brands Holdings UK Ltd (& Anor

Brewin & Anor v Bathroom Brands Holdings UK Ltd (& Anor

BBHUK, through its nominee directors, conducted the affairs of Cintep Development Limited in a manner that was unfairly prejudicial to the petitioners by excluding them from management, breaching contractual and statutory obligations, unilaterally removing company assets, withdrawing funding in breach of contract, and blocking the company from pursuing its rights. The court rejected BBHUK’s argument that it had been misled as to the state of the product and found that the petitioners did not contribute to or justify the unfairly prejudicial conduct. The cumulative effect of BBHUK’s actions destroyed the value of the petitioners’ shareholding and their legitimate expectations as...

Parties
Petitioner: Peter Brewin; Petitioner: Nicholas Christy; First Respondent: Bathroom Brands Holdings UK Limited (BBHUK); Second Respondent: Cintep Development Limited
Jurisdiction
England and Wales
Judgment Date
26 November 2020
Procedural Posture
Petition for Unfair Prejudice Under Companies Act 2006 / Judgment on Liability Only; Remedy/valuation to Be Determined at a Later Hearing
Outcome
Petition for unfair prejudice allowed; liability established against BBHUK; remedy to be determined at a further hearing.
Legal Topics
Unfair Prejudice, Minority Shareholder Rights, Director Duties, Joint Ventures, Nominee Directors, Breach of Contract
Company Law Equity Unfair Prejudice Minority Shareholder Rights Director Duties Joint Ventures Nominee Directors Breach of Contract

Case Brief

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Parties

Peter Brewin

Petitioner

Nicholas Christy

Petitioner

Bathroom Brands Holdings UK Limited (BBHUK)

First Respondent

Cintep Development Limited

Second Respondent

Procedural Posture

Petition for Unfair Prejudice Under Companies Act 2006 / Judgment on Liability Only; Remedy/valuation to Be Determined at a Later Hearing

Legal Issues

  1. 1 Whether the affairs of Cintep Development Limited were conducted in a manner unfairly prejudicial to the interests of the petitioners as minority shareholders under section 994 of the Companies Act 2006
  2. 2 Whether BBHUK and its nominee directors breached their contractual, statutory, and fiduciary duties to the petitioners and the company
  3. 3 Whether the conduct of BBHUK justified the grant of relief under section 996 of the Companies Act 2006

Ratio Decidendi

BBHUK, through its nominee directors, conducted the affairs of Cintep Development Limited in a manner that was unfairly prejudicial to the petitioners by excluding them from management, breaching contractual and statutory obligations, unilaterally removing company assets, withdrawing funding in breach of contract, and blocking the company from pursuing its rights. The court rejected BBHUK’s argument that it had been misled as to the state of the product and found that the petitioners did not contribute to or justify the unfairly prejudicial conduct. The cumulative effect of BBHUK’s actions destroyed the value of the petitioners’ shareholding and their legitimate expectations as...

Court Disposition

Petition for unfair prejudice allowed; liability established against BBHUK; remedy to be determined at a further hearing.

Orders

  • Declaration that BBHUK conducted the affairs of Cintep Development Limited in a manner unfairly prejudicial to the petitioners under section 994 of the Companies Act 2006
  • Directions for a further hearing to determine appropriate relief, likely including an order for BBHUK to purchase the petitioners’ shares at a value to be determined