Minority shareholder - unfair prejudice
15/04/2010
This case study demonstrates the expertise of our Corporate, Commercial, Employment and Dispute Resolution teams who worked closely together to secure a successful outcome for our client, seamlessly managing unfair dismissal and unfair prejudice claims side-by-side and offering the client a single point of contact in relation to both claims.
Our client had worked for nearly ten years in a family business. He was an employee, a director and a substantial shareholder in the companies through which the family business was conducted.
With no warning, our client was suspended from his employment and, following a sham process, dismissed. He was barred from the premises of the business and excluded from meetings of the directors of the companies. Our client initially came to Thomson Snell & Passmore to seek advice in relation to his employment position, but it soon became apparent that the more significant issue was his substantial shareholding.Without access to premises, to board meetings or to management information, our client lost control of his shares in the companies and the benefit and value of his considerable investment of time, energy and expertise since the business had been founded.
On discovering that he was not being paid dividends when the other shareholders were, Thomson Snell & Passmore advised its client to commence an action for unfair prejudice pursuant to section 994 of the Companies Act 2006, seeking an order from the court that his shares be purchased by the other shareholders in the companies, at a fair value. Proceedings for unfair dismissal were also issued in the Employment Tribunal.
Unfair prejudice proceedings were issued in the High Court due to the other side's obstructive conduct. The parties agreed to mediate but mediation proved unsuccessful. The matter was finally settled a matter of days before our client attended a final hearing in the Employment Tribunal on very beneficial terms for our client. The two pronged attack and strategy used by the Thomson Snell & Passmore team working on the matter delivered our client with an extremely positive outcome.
Our client was delighted with the result and has since instructed Thomson Snell & Passmore's Wills, Trusts and Tax Planning team. This case study demonstrates how our clients can benefit from the support and collective experience of the firm. As well as corporate and commercial, we offer a strong network of lawyers to provide a comprehensive service, supported by a commercial and client focused approach.