Unfair Prejudice And Obtaining Relief For The Company

• Published date: 12 March 2024
• Law Firm: ParrisWhittaker
• Author: Parris Whittaker

To what extent can an aggrieved shareholder seek remedies for a company in an unfair prejudice claim? The specialist corporate lawyers at ParrisWhittaker are experienced in advising shareholders and directors on corporate and commercial disputes.

An important judicial ruling has confirmed that remedies can extend beyond personal relief - to the company itself. It means obtaining fair and proportionate remedies in the end of a director's breach of duty may not require an unfair prejudice claim and a separate derivative action.

What's unfair prejudice?

Unfair prejudice arises in circumstances where the majority shareholders (who are frequently directors within the company) abuse their powers to further their own interests to the detriment of the other shareholders. This often leads directly to the devaluation of their shares.

The affected shareholders...