Einde inhoudsopgave
Exit remedies for minority shareholders in close companies (IVOR nr. 82) 2011/4.3.3.2
4.3.3.2 Sales of substantial assets
dr. Q. Wang, datum 02-05-2011
- Datum
02-05-2011
- Auteur
dr. Q. Wang
- JCDI
JCDI:ADS403010:1
- Vakgebied(en)
Ondernemingsrecht (V)
Voetnoten
Voetnoten
S. 190 (CA 2006) Substantial property transactions: requirement of members' approval (1) A company may not enter info an arrangement under which (a) a director of the company or of its holding company, or a person connected with such a director, acquires or is to acquire from the company (directly or indirectly) a substantial non-cash asset, or (b) the company acquires or is to acquire a substantial non-cash asset (directly or indirectly) from such a director or a person so connected, unless the arrangement has been approved by a resolution of the members of the company or is conditional on such approval being obtained. For the meaning of 'substantial non-cash asset' see Section 191. (2) If the director or connected person is a director of the company's holding company or a person connected with such a director, the arrangement must also have been approved by a resolution of the members of the holding company or be conditional on such approval being obtained. (3) A company shall not be subject to any liability by reason of a failure to obtain approval required by this section.(4) No approval is required under this section on the part of the members of a body corporate that (a) is not a UK-registered company, or (b) is a wholly-owned subsidiary of another body corporate.(5) For the purposes of this section (a) an arrangement involving more than one non-cash asset, or (b) an arrangement that is one of a series involving non-cash assets, shall be treated as if they involved a non-cash asset of a value equal to the aggregate value of all the non-cash assets involved in the arrangement or, as the case may be, the series. (6) This section does not apply to a transaction so far as it relates (a) to anything to which a director of a company is entitled under hisservice contract, or (b) to payment for loss of office as defined in section 215 (payments requiring members' approval).Detailed discussion about this article exceeds the scope of this research. For more knowledge about the application of this article see the following cases: Duckwari Plc (No.2), Re, [1999] Ch. 253; [1998] 3 W.L.R. 913; [1999] B.C.C. 11; [1998] 2 BCLC 315; (1998) 95(22) L.S.G. 28; (1998) 95(20) L. S.G. 36; (1998) 142 S.J.L.B. 163; Times, May 18, 1998 (CA (Civ Div)); Duomatic Ltd, Re, [1969] 2 Ch. 365; [1969] 2 W.L.R. 114; [1969] 1 All E.R. 161; (1968) 112 S.J. 922 (Ch D); Dunlop Pneumatic Tyre Co Ltd v. New Garage & Motor Co Ltd, [1915] A.C. 79 (HL); United International Pictures v. Cine Bes Filmcilik ve Yapimcilik AS, [2003] EWCA Civ 1669; [2004] 1 C.L.C. 401; (2003) 147 S.J.L. B. 1396 (CA (Civ Div)).
In the UK, if a sale of substantial assets is approved by the general meeting, the minority shareholders have no appraisal rights to require an exit. If, however, such a transaction is tainted by a conflict of interests, the minority then has remedies through derivative and direct actions. Substantial property transactions involving directors (a shadow director is also treated as a director), or a person connected with such directors are subject to review onder s.190, CA 2006.1 The court can rule that the transaction is voidable and the wrongdoers are liable for the damages and loss resulting from the transaction. And if the transaction causes unfair prejudice (s.994) to certain members, these members can bring a direct action against the controlling shareholders. This unfair prejudice remedy will be discussed in section 4.4 of this chapter.