Boston Trust Company Ltd v Szerelmey Ltd & Ors

Boston Trust Company Ltd v Szerelmey Ltd & Ors

The court has jurisdiction to grant conditional permission to pursue a derivative action at common law where the claimant currently lacks standing but has a sufficiently arguable and proximate prospect of acquiring standing through separate proceedings. It is just and appropriate to exercise that jurisdiction in the circumstances, keeping the action in abeyance pending the outcome of the rectification claim.

Parties
Claimant: Boston Trust Company Limited; Claimant: Boston Fiduciary Management Limited; Defendant: Szerelmey Limited; Defendant: Szerelmey (GB) Limited; Defendant: Szerelmey Restoration Limited; Defendant: Tellisford Limited; Defendant: Gordon Verhoef; Defendant: Szerelmey (UK) Limited; Defendant: London Stone Limited; Defendant: Heritage House (York) Limited; Defendant: Tusk Holdings Limited; Defendant: Hare and Ransome Joinery Ltd
Jurisdiction
England and Wales
Judgment Date
26 May 2020
Procedural Posture
Derivative Action (common Law) / Permission Application (second Stage) and Consequential Hearing
Outcome
Conditional permission granted
Legal Topics
Derivative Actions, Standing, Rectification of Share Register, Case Management Discretion, Conditional Orders
Company Law Civil Procedure Derivative Actions Standing Rectification of Share Register Case Management Discretion Conditional Orders

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Parties

Boston Trust Company Limited

Claimant

Boston Fiduciary Management Limited

Claimant

Szerelmey Limited

Defendant

Szerelmey (GB) Limited

Defendant

Szerelmey Restoration Limited

Defendant

Tellisford Limited

Defendant

Gordon Verhoef

Defendant

Szerelmey (UK) Limited

Defendant

London Stone Limited

Defendant

Heritage House (York) Limited

Defendant

Tusk Holdings Limited

Defendant

Hare and Ransome Joinery Ltd

Defendant

Procedural Posture

Derivative Action (common Law) / Permission Application (second Stage) and Consequential Hearing

Legal Issues

  1. 1 Whether the court has jurisdiction to grant conditional permission to pursue a derivative action where the claimant currently lacks standing but may acquire it through separate proceedings
  2. 2 Whether the court should exercise its discretion to grant conditional permission or stay proceedings in light of inchoate standing

Ratio Decidendi

The court has jurisdiction to grant conditional permission to pursue a derivative action at common law where the claimant currently lacks standing but has a sufficiently arguable and proximate prospect of acquiring standing through separate proceedings. It is just and appropriate to exercise that jurisdiction in the circumstances, keeping the action in abeyance pending the outcome of the rectification claim.

Court Disposition

Conditional permission granted

Orders

  • Boston granted conditional permission to pursue the derivative action, conditional on acquiring standing through the rectification claim.
  • Costs indemnity application and costs of the permission application reserved to a further hearing (the 'October Hearing').