Prowting 1968 Trustee One Ltd & Ors v Amos-Yeo & Anor [2015] EWHC 2480 (Ch) (18 August 2015)

Prowting 1968 Trustee One Ltd & Ors v Amos-Yeo & Anor [2015] EWHC 2480 (Ch) (18 August 2015)

The parties had a common continuing intention that the defendants would receive sufficient shares to meet the 5% nominal capital threshold for entrepreneurs' relief, but due to a calculation error, the agreements did not reflect this. The mistake was as to the effect of the document, not merely its consequences. Rectification is therefore ordered to reflect the true intention.

Citation
[2015] EWHC 2480 (Ch)
Parties
Claimant: PROWTING 1968 TRUSTEE ONE LIMITED; Claimant: PROWTING 1968 TRUSTEE TWO LIMITED; Claimant: PROWTING 1987 TRUSTEE ONE LIMITED; Claimant: PROWTING 1987 TRUSTEE TWO LIMITED; Defendant: BARRY PETER AMOS-YEO; Defendant: KEVIN RICHARD AMOS-YEO
Jurisdiction
England and Wales
Judgment Date
18 August 2015
Procedural Posture
Part 8 Claim for Rectification / Judgment After Trial
Outcome
Rectification granted
Legal Topics
Rectification of Instruments, Common Mistake, Share Acquisition Agreements, Entrepreneurs' Relief, Capital Gains Tax
Equity Trusts Company Law Rectification of Instruments Common Mistake Share Acquisition Agreements Entrepreneurs' Relief Capital Gains Tax

Case Brief

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Parties

PROWTING 1968 TRUSTEE ONE LIMITED

Claimant

PROWTING 1968 TRUSTEE TWO LIMITED

Claimant

PROWTING 1987 TRUSTEE ONE LIMITED

Claimant

PROWTING 1987 TRUSTEE TWO LIMITED

Claimant

BARRY PETER AMOS-YEO

Defendant

KEVIN RICHARD AMOS-YEO

Defendant

Procedural Posture

Part 8 Claim for Rectification / Judgment After Trial

Legal Issues

  1. 1 Whether the share acquisition agreements should be rectified for common mistake to reflect the parties' true intention regarding the number of shares and consideration to satisfy entrepreneurs' relief requirements.

Ratio Decidendi

The parties had a common continuing intention that the defendants would receive sufficient shares to meet the 5% nominal capital threshold for entrepreneurs' relief, but due to a calculation error, the agreements did not reflect this. The mistake was as to the effect of the document, not merely its consequences. Rectification is therefore ordered to reflect the true intention.

Court Disposition

Rectification granted

Orders

  • The share acquisition agreements are to be rectified to transfer 30,000 shares to each defendant for an additional consideration of £100,000, as per the draft order attached to the claimants' counsel's skeleton argument.