Oak Investment Partners XII, Ltd. Partnership v Boughtwood & Ors

Oak Investment Partners XII, Ltd. Partnership v Boughtwood & Ors

Mr Boughtwood conducted QED/PML's business in a manner unfairly prejudicial to Oak by persistently exceeding his agreed CTO role, refusing to accept necessary funding at market valuations, orchestrating a coup to seize board control, destroying trust and confidence, and impeding management. Oak's conduct did not cause actual prejudice to Mr Boughtwood. Remedy: Mr Boughtwood must sell his shares in QED to Oak.

Parties
Petitioner: Oak Investment Partners XII, Limited Partnership; Respondent: Martin Boughtwood; Respondent: Andrew Boughtwood; Respondent: Stephen Bennett; Respondent: QED Group Limited
Jurisdiction
England and Wales
Judgment Date
06 February 2009
Procedural Posture
Petition and Cross Petition Under Section 994 Companies Act 2006 / Final Judgment
Outcome
Petition allowed; Cross-Petition dismissed
Legal Topics
Unfair Prejudice, Quasi Partnership, Shareholder Remedies, Fiduciary Duties, Corporate Governance, Venture Capital Investment, Board Control, Winding Up, Administration
Company Law Equity Insolvency Unfair Prejudice Quasi Partnership Shareholder Remedies Fiduciary Duties Corporate Governance +4 more

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Parties

Oak Investment Partners XII, Limited Partnership

Petitioner

Martin Boughtwood

Respondent

Andrew Boughtwood

Respondent

Stephen Bennett

Respondent

QED Group Limited

Respondent

Procedural Posture

Petition and Cross Petition Under Section 994 Companies Act 2006 / Final Judgment

Legal Issues

  1. 1 Whether conduct of QED/PML's affairs was unfairly prejudicial to Oak's interests under section 994
  2. 2 Whether Oak's conduct was unfairly prejudicial to Mr Boughtwood's interests
  3. 3 Interpretation of quasi-partnership obligations

Ratio Decidendi

Mr Boughtwood conducted QED/PML's business in a manner unfairly prejudicial to Oak by persistently exceeding his agreed CTO role, refusing to accept necessary funding at market valuations, orchestrating a coup to seize board control, destroying trust and confidence, and impeding management. Oak's conduct did not cause actual prejudice to Mr Boughtwood. Remedy: Mr Boughtwood must sell his shares in QED to Oak.

Court Disposition

Petition allowed; Cross-Petition dismissed

Orders

  • Order requiring Mr Boughtwood to sell his shares in QED to Oak under section 996 Companies Act 2006
  • Further argument to be heard on price and terms of sale