In re Grafters Ltd. [2015] 1 JLR 144 (22 December 2014)
- Citation
- [2015] 1 JLR 144
- Status
- Judgment
- Jurisdiction
- Jersey
- Posture
- Unfair Prejudice Petition / Judgment on Valuation and Remedy
More details
- Posture
- Unfair Prejudice Petition / Judgment on Valuation and Remedy
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Professional case brief
Research organized from the available case record
01
Holding and result
Where a shareholder is unfairly excluded as director and no reasonable offer is made for their shares, the court will order a purchase at a fair value, which may be the value at the date of exclusion if subsequent changes in company value are not attributable to the excluded shareholder.
Court disposition
Order for purchase of applicant's shares at fair value
Orders
- Respondent to purchase applicant's shares at £25,000
02
Material facts
Parties
Grafters Ltd.
RespondentUnnamed minority shareholder
ApplicantAmounts and remedies
- Share Purchase Value: GBP 25,000
03
Procedural history
Posture
Unfair Prejudice Petition / Judgment on Valuation and Remedy
04
Questions and positions
Legal issues
- 01
Whether exclusion of a shareholder as director without a reasonable offer to purchase shares constitutes unfair prejudice under Companies (Jersey) Law 1991, art. 141
- 02
How shares should be valued under art. 143 when company value has changed since exclusion
Party arguments
- Applicant
- Applicant argued exclusion as director was unfair and no reasonable offer was made to purchase their shares.
- Respondent
- Respondent argued subsequent decline in company value was not their fault and should be reflected in share valuation.
05
Court’s reasoning
Legal principles
- 01
Companies (Jersey) Law 1991, art. 143
Shares are to be valued at the date of the order unless fairness dictates otherwise.
- 02
Companies (Jersey) Law 1991, art. 141
If exclusion was unfair and no reasonable offer was made, court may order purchase of shares at a fair value.
06
Ratio, limits and disposition
Ratio decidendi
Where a shareholder is unfairly excluded as director and no reasonable offer is made for their shares, the court will order a purchase at a fair value, which may be the value at the date of exclusion if subsequent changes in company value are not attributable to the excluded shareholder.
Court disposition
Order for purchase of applicant's shares at fair value
- Respondent to purchase applicant's shares at £25,000
Source and reliance status
Official court record
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Judgment text
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Court record
Judgment
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BAILII >> Databases >> Jersey Law Reports >> In re Grafters Ltd. [2015] 1 JLR 144 (22 December 2014) URL: https://www.bailii.org/je/cases/JLR/2014/JLR151144.html Cite as: [2015] 1 JLR 144 [ New search ] [ Help ] In re Grafters Ltd. 2015 (1) JLR 144 (22 December 2014) Companies-minority shareholders-unfair prejudice-if, on application under Companies (Jersey) Law 1991, art. 141, exclusion of shareholder as director of company unfair because no reasonable offer made to purchase shareholding, court to order purchase of shares at reasonable value under art. 143-shares valued at date of order unless fairness dictates otherwise-if director excluded in 2007 (shortly after buying shareholding for £25,000), company subsequently flourished but now almost worthless (through no fault of other shareholders), fair valuation would be £25,000 The document you wish to view is available to registered users or can be purchased as a PDF. To purchase this document in PDF format or alternatively to Register to purchase membership go to the Jersey Law website via this link: 2015 (1) JLR 144 BAILII: Copyright Policy | Disclaimers | Privacy Policy | Feedback | Donate to BAILII URL: https://www.bailii.org/je/cases/JLR/2014/JLR151144.html
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