Farstad Supply A/S v Enviroco Limited

Farstad Supply A/S v Enviroco Limited

Enviroco Limited was not a subsidiary of ASCO plc within the meaning of section 736(1)(c) of the Companies Act 1985 at the relevant time because ASCO was not a member of Enviroco, having transferred its shares to the Bank's nominee as security under Scots law. The statutory definition requires actual membership,...

Source-derived case information.

Parties
Respondent: Farstad Supply A/S; Appellant: Enviroco Limited
Jurisdiction
England and Wales
Judgment Date
06 April 2011
Procedural Posture
Appeal / Judgment of the Supreme Court on Appeal From the Court of Appeal
Outcome
Appeal dismissed
Legal Topics
Definition of Subsidiary, Statutory Interpretation, Security Over Shares, Membership in Company, Contractual Incorporation of Statute
Company Law Contract Law Definition of Subsidiary Statutory Interpretation Security Over Shares Membership in Company Contractual Incorporation of Statute

Source-derived case record

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 4 Authorities cited 16 Party arguments 2 Amounts and remedies 1
Sign in to unlock

Parties

Farstad Supply A/S

Respondent

Enviroco Limited

Appellant

Procedural Posture

Appeal / Judgment of the Supreme Court on Appeal From the Court of Appeal

Legal Issues

  1. 1 Whether Enviroco Limited was an 'Affiliate' of the Charterer under the charterparty by virtue of being a subsidiary of ASCO plc within the meaning of section 736 of the Companies Act 1985, given the shares were registered in the name of a nominee for security purposes under Scots law.

Ratio Decidendi

Enviroco Limited was not a subsidiary of ASCO plc within the meaning of section 736(1)(c) of the Companies Act 1985 at the relevant time because ASCO was not a member of Enviroco, having transferred its shares to the Bank's nominee as security under Scots law. The statutory definition requires actual membership, i.e., entry on the register, and the attribution provisions do not deem beneficial owners as members. Therefore, Enviroco was not an Affiliate under the charterparty, and the appeal is dismissed.

Court Disposition

Appeal dismissed

Orders

  • Appeal dismissed; declaration sought by Enviroco refused.