Director & Shareholder Disputes - Virtual Conference 2025

Introduction

Chaired by Nicholas Grier, this conference provides an update on the latest developments in relation to shareholder litigation. It will include an update on unfair prejudice as well as consider derivative claims and latest remedies under the Companies Act.

Conference Agenda

This virtual online conference will cover the following topics:

9.30am - 10.30am: Derivative Claims: Why Directors Need to Worry

Chair: Nicholas Grier

When company law started in the 19th century, directors were almost untouchable. But recently, in the light of the increasing awareness of derivative claims, directors’ breaches of the duties owed to their own companies are more open to scrutiny.

This session will cover the following:

• The hurdles that are put in the member's way for derivative claims - and why?
• Procedural niceties
• Recent case law on both successful and unsuccessful claims
• Wider effect and purpose of derivative claims

10.30am - 11.30am: Shareholder Litigation Update

Ed Weeks, Cripps LLP

A look at the practical impact of some key cases from 2023 and 2024 in relation to the following aspects of shareholder litigation:

• Limitation
• Unfair prejudice and the operation of exit provisions
• The Duomatic principle
• Injunctive Relief in shareholder petitions
• Privilege in relation to legal advice to the company
• The cross-over between s.994 and derivative actions
• Directors duties
• Good faith

11.30am - 11.45am: Morning break for refreshments

11.45am - 12.45pm: The Court’s Remedies under s.996 of the Companies Act

Ed Weeks, Cripps LLP

A look at the scope of this statutory provision with reference to relevant case law, considering in particular:

• Limits to the breadth of the remedy
• An overview of the five specific types of relief:
• Regulating the conduct of the Company’s affairs
• Requiring the Company to do something or stop doing something
• Authorising civil proceedings
• Blocking changes to the Articles of Association
• Providing for the purchase of shares
• A look at some specific issues in relation to the last of these remedies, and the terms on which a share purchase order may be made

12.45pm - 1.00pm: Questions on Morning Session

Lunch

2.00pm - 3.00pm: Directors & Winding-up & Directors & Liability for Misleading Information

Nicholas Grier

Part A: Directors & Winding-up

Unhappy members may petition for the winding-up of a company on just and equitable grounds. If the liquidator discovers that a director has breached his duty to his company, even though the company was solvent at the time of winding-up, a director may still be liable to compensate the company if he had occasioned the company any loss.

This talk covers the following:

• The grounds for just and equitable winding-up
• Who may petition for just and equitable winding-up
• The potential risks for directors even on solvent winding-up
• The authorisation by directors of potentially unjustified dividends not long before winding-up
• Potential protection for directors

Part B: Directors & Liability for Misleading Information

There has been a recent flurry of cases on the potential liability of those responsible for inaccuracies in prospectuses or other published information relating to companies whose shares are publicly traded. While sometimes the company itself may be initially responsible, this does not prevent the company, if necessary, passing on the liability to individual directors responsible for the inaccuracies.

There have also been group actions, where groups of unhappy shareholders have started proceedings against directors who provided misleading accounting information to the markets, resulting in potential loss to shareholders. Group actions are difficult to organise, and so far it has proved difficult to prove that directors are liable to their members. Nevertheless, some cases have settled, with a tacit admission that the markets were misled. Directors who push the limits on acceptable accounting practice may find that such actions have consequences.

This session covers the following:

• Liability for directors or other under S.90 of the Financial Services and Markets Act 2000 (prospectuses and listing particulars)
• Liability for issuers under s.90A and Sch.10A of FSMA 2000
• Recent cases, successful, unsuccessful or settled
• Difficulties with group actions and establishing liability
• How to avoid such problems in the first place

3.00pm - 4.00pm: Unfair Prejudice: Claim Quantum Implications of Diversion of Trade and Asset Stripping

Martin Chapman & Neil Rudd, Crowe LLP

Using case study examples this session will cover the following:

• Share valuation approaches and principals in the context of shareholder disputes
• Oddities to look out for when a share valuation is required
• Approaches to investigating whether there has been diversion of trade and/or asset stripping
• The incorporation of the impact of diversion of trade and/or asset stripping into the quantum of unfair prejudice claims

4.00pm - Close: Chair's Closing Summary and Questions & Answers

Recording of live sessions: Soon after the Learn Live session has taken place you will be able to go back and access the recording - should you wish to revisit the material discussed.