Anderson v Hogg [2001] ScotCS 287 (14 December 2001)

Anderson v Hogg [2001] ScotCS 287 (14 December 2001)

The payment of £50,000 to the respondent was unauthorised and in excess of what the petitioner had agreed (£30,000). The excess payment (£20,000) constituted unfairly prejudicial conduct under section 459 of the Companies Act 1985. The remedy sought by the petitioner should be granted for the excess payment, as there was no equitable bar to the petitioner's complaint and the respondent's good faith did not negate the unfairness.

Citation
[2001] ScotCS 287
Parties
Petitioner and Reclaimer: John Farquhar Anderson; Respondent: Ruaraigh Hogg
Jurisdiction
Scotland
Judgment Date
14 December 2001
Procedural Posture
Reclaiming Motion in Petition Under Companies Act 1985, Sections 459 461 / Appeal (reclaiming Motion) From Lord Ordinary's Decision
Outcome
Reclaiming motion allowed in part; Lord Ordinary's interlocutor varied.
Legal Topics
Unfair Prejudice, Directors' Powers, Shareholder Remedies, Redundancy Payments, Derivative Actions
Company Law Equity Unfair Prejudice Directors' Powers Shareholder Remedies Redundancy Payments Derivative Actions

Case Brief

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Parties

John Farquhar Anderson

Petitioner and Reclaimer

Ruaraigh Hogg

Respondent

Procedural Posture

Reclaiming Motion in Petition Under Companies Act 1985, Sections 459 461 / Appeal (reclaiming Motion) From Lord Ordinary's Decision

Legal Issues

  1. 1 Whether payment of £50,000 redundancy to respondent was unauthorised and unfairly prejudicial to petitioner under section 459 of Companies Act 1985
  2. 2 Whether remedy under section 461 should be granted
  3. 3 Appropriateness of section 459 petition versus derivative action

Ratio Decidendi

The payment of £50,000 to the respondent was unauthorised and in excess of what the petitioner had agreed (£30,000). The excess payment (£20,000) constituted unfairly prejudicial conduct under section 459 of the Companies Act 1985. The remedy sought by the petitioner should be granted for the excess payment, as there was no equitable bar to the petitioner's complaint and the respondent's good faith did not negate the unfairness.

Court Disposition

Reclaiming motion allowed in part; Lord Ordinary's interlocutor varied.

Orders

  • Order for respondent to repay £20,000 to the company in respect of excess redundancy payment.