Interactive Technology Corporation Ltd v Ferster & Ors

Interactive Technology Corporation Ltd v Ferster & Ors

The online gaming business and assets were at all times owned by ITC. The APA and SSA were not authorized by ITC and are not binding. Jonathan Ferster lacked authority to commit ITC to these agreements. Monies in accounts of corporate defendants are held on bare trust for ITC. Jonathan's increases in remuneration and certain expenses were unauthorized and must be repaid. Jonathan's conduct was dishonest and unreasonable. No relief is granted to Jonathan under section 996 Companies Act 2006 due to his significant wrongdoing, which caused the breakdown of trust and confidence among shareholders.

Parties
Claimant: Interactive Technology Corporation Limited; Defendant: Jonathan Ferster; Defendant: World Online Software N.V.; Defendant: Carmel Media Group N.V.; Defendant: Data Traffic Solutions Limited; Defendant: Four Seasons Advertising Limited; Defendant: Four Seasons Media Limited; Defendant: Four Seasons Technology Limited; Defendant: Interactive Technology Corporation (Europe) Limited; Defendant: Lanesborough Investments Limited; Defendant: Lanesborough Media Limited; Defendant: Lanesborough Technology Limited; Defendant: Peaklink Limited; Defendant: Woodville Limited; Defendant: World Online Software Limited; Petitioner: Stuart Ferster; Petitioner: Warren Ferster
Jurisdiction
England and Wales
Judgment Date
15 November 2016
Procedural Posture
Civil / Final Judgment
Outcome
Claims by ITC, Warren and Stuart against Jonathan Ferster succeed. APA and SSA declared not binding. Jonathan ordered to repay unauthorized remuneration and expenses. No relief granted to Jonathan under section 996 Companies Act 2006.
Legal Topics
Unfair Prejudice, Director's Duties, Breach of Fiduciary Duty, Remuneration, Corporate Assets, Freezing Orders, Search Orders, Asset Ownership, Shareholder Disputes
Company Law Trusts Commercial Law Unfair Prejudice Director's Duties Breach of Fiduciary Duty Remuneration Corporate Assets +4 more

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Parties

Interactive Technology Corporation Limited

Claimant

Jonathan Ferster

Defendant

World Online Software N.V.

Defendant

Carmel Media Group N.V.

Defendant

Data Traffic Solutions Limited

Defendant

Four Seasons Advertising Limited

Defendant

Four Seasons Media Limited

Defendant

Four Seasons Technology Limited

Defendant

Interactive Technology Corporation (Europe) Limited

Defendant

Lanesborough Investments Limited

Defendant

Lanesborough Media Limited

Defendant

Lanesborough Technology Limited

Defendant

Peaklink Limited

Defendant

Woodville Limited

Defendant

World Online Software Limited

Defendant

Stuart Ferster

Petitioner

Warren Ferster

Petitioner

Procedural Posture

Civil / Final Judgment

Legal Issues

  1. 1 Ownership of online gaming business and assets
  2. 2 Validity and effect of Asset Purchase Agreement (APA) and Supply of Services Agreement (SSA)
  3. 3 Authority of managing director to bind company

Ratio Decidendi

The online gaming business and assets were at all times owned by ITC. The APA and SSA were not authorized by ITC and are not binding. Jonathan Ferster lacked authority to commit ITC to these agreements. Monies in accounts of corporate defendants are held on bare trust for ITC. Jonathan's increases in remuneration and certain expenses were unauthorized and must be repaid. Jonathan's conduct was dishonest and unreasonable. No relief is granted to Jonathan under section 996 Companies Act 2006 due to his significant wrongdoing, which caused the breakdown of trust and confidence among shareholders.

Court Disposition

Claims by ITC, Warren and Stuart against Jonathan Ferster succeed. APA and SSA declared not binding. Jonathan ordered to repay unauthorized remuneration and expenses. No relief granted to Jonathan under section 996 Companies Act 2006.

Orders

  • APA and SSA declared not binding on ITC.
  • Monies in accounts of corporate defendants held on bare trust for ITC.