Micro Leisure Ltd v County Properties & Developments Ltd & Anor [1999] ScotCS 25 (19 January 1999)

Micro Leisure Ltd v County Properties & Developments Ltd & Anor [1999] ScotCS 25 (19 January 1999)

It is not possible without inquiry to determine whether reduction of the 1994 disposition is available; the factual background and interrelationship of the transactions must be explored to assess the scope of any unauthorised arrangement, the possibility of restitution, and the effect on third-party rights. As to the 1996 Agreement, section 320 applies only if County acquired a non-cash asset of requisite value, which depends on whether Micro owned relevant land and whether the rights created are of sufficient value. The claim for accounting under section 322(3)(a) is relevant for inquiry unless it is plain that no gain was made by County.

Citation
[1999] ScotCS 25
Parties
Pursuer: Micro Leisure Limited; First Defender: County Properties & Developments Limited; Second Defender: Keeper of the Registers of Scotland
Jurisdiction
Scotland
Judgment Date
19 January 1999
Procedural Posture
Civil (court of Session, Scotland) / Interlocutory Opinion on Relevancy and Further Procedure
Outcome
Case put out By Order for further procedure; no dismissal at this stage.
Legal Topics
Directors' Duties, Connected Persons Transactions, Non Cash Asset Arrangements, Reduction (avoidance) of Transactions, Restitution, Statutory Interpretation (companies Act 1985)
Company Law Property Law Civil Procedure Directors' Duties Connected Persons Transactions Non Cash Asset Arrangements Reduction (avoidance) of Transactions Restitution +1 more

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 4 Authorities cited 12 Party arguments 2 Amounts and remedies 6
Sign in to unlock

Parties

Micro Leisure Limited

Pursuer

County Properties & Developments Limited

First Defender

Keeper of the Registers of Scotland

Second Defender

Procedural Posture

Civil (court of Session, Scotland) / Interlocutory Opinion on Relevancy and Further Procedure

Legal Issues

  1. 1 Whether the disposition of property by Micro to County contravened section 320 of the Companies Act 1985 and is voidable under section 322
  2. 2 Whether the Minute of Agreement of 26 February 1996 falls within section 320 as an acquisition of a non-cash asset
  3. 3 Whether County is liable to account for any gain under section 322(3)(a) if reduction is not available

Ratio Decidendi

It is not possible without inquiry to determine whether reduction of the 1994 disposition is available; the factual background and interrelationship of the transactions must be explored to assess the scope of any unauthorised arrangement, the possibility of restitution, and the effect on third-party rights. As to the 1996 Agreement, section 320 applies only if County acquired a non-cash asset of requisite value, which depends on whether Micro owned relevant land and whether the rights created are of sufficient value. The claim for accounting under section 322(3)(a) is relevant for inquiry unless it is plain that no gain was made by County.

Court Disposition

Case put out By Order for further procedure; no dismissal at this stage.

Orders

  • Further inquiry required to determine factual background and legal consequences.
  • No decree of reduction or accounting at this stage; issues to be determined after further procedure.