Sudicka v Morgan & Ors

Sudicka v Morgan & Ors

Ms Sudicka was beneficially entitled to 50% of AGLK. Mr Morgan breached the shareholders' agreement and his director duties by excluding her, misappropriating company funds, and orchestrating the transfer of business and assets to himself, assisted by Mr Garton, Mr Crocker, and Mr Cotton. Their conduct amounted to unfair prejudice under s994 Companies Act 2006. The appropriate remedy is a buyout of Ms Sudicka's 50% shareholding at a value of £202,500 as at March 2015, with joint and several liability apportioned as specified.

Parties
Claimant/petitioner: Romana Sudicka; Defendant/respondent: Steven Charles Morgan; Defendant/respondent: AGL Accountants Ltd; Defendant/respondent: David John Cotton; Respondent: Ian Glen Garton; Respondent: Charles Steven Crocker
Jurisdiction
England and Wales
Judgment Date
27 February 2019
Procedural Posture
Civil (company Law, Unfair Prejudice Petition, Contract) / Final Judgment
Outcome
Petition and claim allowed; judgment for Ms Sudicka.
Legal Topics
Unfair Prejudice, Shareholder Disputes, Director Duties, Quasi Partnership, Breach of Shareholders' Agreement, Valuation of Shares, Breach of Fiduciary Duty
Company Law Contract Law Equity Unfair Prejudice Shareholder Disputes Director Duties Quasi Partnership Breach of Shareholders' Agreement +2 more

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Parties

Romana Sudicka

Claimant/petitioner

Steven Charles Morgan

Defendant/respondent

AGL Accountants Ltd

Defendant/respondent

David John Cotton

Defendant/respondent

Ian Glen Garton

Respondent

Charles Steven Crocker

Respondent

Procedural Posture

Civil (company Law, Unfair Prejudice Petition, Contract) / Final Judgment

Legal Issues

  1. 1 Whether Ms Sudicka was entitled to 50% of the shares in AGL Accountants Ltd (AGLK)
  2. 2 Whether Mr Morgan breached the shareholders' agreement and director duties
  3. 3 Whether Mr Cotton's shares were validly bought back and/or transferred

Ratio Decidendi

Ms Sudicka was beneficially entitled to 50% of AGLK. Mr Morgan breached the shareholders' agreement and his director duties by excluding her, misappropriating company funds, and orchestrating the transfer of business and assets to himself, assisted by Mr Garton, Mr Crocker, and Mr Cotton. Their conduct amounted to unfair prejudice under s994 Companies Act 2006. The appropriate remedy is a buyout of Ms Sudicka's 50% shareholding at a value of £202,500 as at March 2015, with joint and several liability apportioned as specified.

Court Disposition

Petition and claim allowed; judgment for Ms Sudicka.

Orders

  • Mr Morgan to pay Ms Sudicka £202,500 for her 50% beneficial interest in AGLK.
  • Mr Garton and Mr Crocker jointly and severally liable with Mr Morgan for the full sum.