UTB, LLC v Sheffield United Ltd [2018] EWHC 1663 (Ch) (29 June 2018)

UTB, LLC v Sheffield United Ltd [2018] EWHC 1663 (Ch) (29 June 2018)

The court refused to grant the mandatory interim injunction compelling UTB to lend £1.25 million to Blades Leisure Ltd because the evidence did not establish that such relief was necessary to preserve the value of the shares or prevent insolvency before trial. The relief sought was invasive, contrary to the parties' contractual arrangements, and not justified on the facts. The balance of convenience did not favour granting the order, and damages would be an adequate remedy if loss occurred.

Citation
[2018] EWHC 1663 (Ch)
Parties
Claimant: UTB, LLC; Defendant: Sheffield United Limited
Jurisdiction
England and Wales
Judgment Date
29 June 2018
Procedural Posture
Application for Interim Injunctive Relief / Interlocutory (pre Trial)
Outcome
Application dismissed
Legal Topics
Interim Injunctions, Shareholder Disputes, Preservation of Property, Mandatory Relief, Section 994 Companies Act 2006, Shareholder Agreements
Company Law Civil Procedure Interim Injunctions Shareholder Disputes Preservation of Property Mandatory Relief Section 994 Companies Act 2006 Shareholder Agreements

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Parties

UTB, LLC

Claimant

Sheffield United Limited

Defendant

Procedural Posture

Application for Interim Injunctive Relief / Interlocutory (pre Trial)

Legal Issues

  1. 1 Whether the court has jurisdiction to compel a shareholder to lend money to a company on an interim basis
  2. 2 Whether it is necessary to grant a mandatory injunction to preserve the value of shares pending trial
  3. 3 Whether the balance of convenience favours granting the relief sought

Ratio Decidendi

The court refused to grant the mandatory interim injunction compelling UTB to lend £1.25 million to Blades Leisure Ltd because the evidence did not establish that such relief was necessary to preserve the value of the shares or prevent insolvency before trial. The relief sought was invasive, contrary to the parties' contractual arrangements, and not justified on the facts. The balance of convenience did not favour granting the order, and damages would be an adequate remedy if loss occurred.

Court Disposition

Application dismissed

Orders

  • No order compelling UTB to lend £1.25 million to Blades Leisure Ltd
  • No interim mandatory injunction granted