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TMI Blog1965 (12) TMI 65X X X X Extracts X X X X X X X X Extracts X X X X ..... public can take their motor cars to be washed. Until December 16, 1964, Evison held more than 50 per cent, of the issued shares of the company, but on that date 750 shares were allotted for cash to Hodge Ltd. Since then the issued share capital of the company has consisted of 3,101 shares of 1 each held as to 748 by Gwent and West, as to 801 by Hodge Ltd., as to 1,240 by Evison, as to 62 by the petitioner and as to the remaining 250 by seven separate shareholders, each holding a comparatively small number of shares Indeed, three of those shareholders hold one share each. Gwent and West and Hodge Ltd. are together the registered holders of 1,549 shares, just under half of the issued shares of the company, but they control the company, or so it is alleged in the petition, and presumably some of the shares held by individual shareholders are held by them as nominees of Gwent and West and Hodge Ltd. The petitioner is, therefore, a small minority shareholder. He was the estate manager of the company until October 14, 1965, when he claims to have been wrongfully dismissed. He was also, until July 9, 1965, a director of the company. The petition alleges that, before December 16, 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oices and discovered that almost 1,000 of their claim could not be substantiated and had put a note to that effect on the file. On the directions, however, of Mr. Evison the amount was paid in full without checking the validity of the claim, ( b ) On November 27, 1964, Mr. Evison proposed at a meeting of the directors that during December the company should sell vouchers for car washing at 2s. 6d. per voucher in minimum quantities of 200. The reason, Mr. Evison explained, for this proposal was that the branches were not taking enough cash each week for the company to meet the demands made upon it by its creditors. Since the actual cost of washing a car is almost 4s., your petitioner and Mr. Brittle opposed the proposal but Mr. Evison by use of his casting vote secured the adoption of the proposal. Your petitioner and Mr. Brittle opposed the proposal since the month of December was one of the best trading months for the company, and if during that month the company could not sell its service at a proper price, it never would be able to do so. ( c ) By reason of the policy decision of Mr. Evison that no attention should be paid to the sale of petrol and other forecourt items, it h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted to negotiate a new lease for the company's site at Trent Bridge, West Bridgeford, Notts. Your petitioner found great difficulty in carrying out these instructions due to the failure of the company to pay its rentals when due. ( i ) On March 1, 1965, your petitioner appeared at the magistrates' court, Sheffield, in answer to a summons under the Factories Act which arose due to the failure of the company to have its young staff medically examined. As a result of this case your petitioner recommended to Mr. Evison that the area and regional managers should be addressed as to their duties under the Factories Act by a factory inspector. Mr. Evison refused this and never at any time insisted that area and regional managers should acquaint themselves with the terms of the Factories Act. ( j ) On March 18, 1965, your petitioner, together with Mr. Evison, Mr. Andrews and Mr. Vellani, paid what was intended to be a secret visit to the company's Lancashire stations. It became quite clear that each site manager knew of the visit and Mr. Evison informed your petitioner that he was aware of the fact that the area manager had warned the site managers of the visit. As a result the time of y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed stations but Mr. Evison still insisted that competitors must be signed on agreements and promised sales promotion assistance that he knew the company was in no position to provide." In paragraph 14 the petitioner alleges that the conduct and management of the company's affairs by Evison has had an adverse effect on the company's trading results, and caused the company to acquire a very poor reputation in the trade. He further alleges that the company is reported to have lost 200,000 during the period from its incorporation down to the middle of March, 1965, and that he believes it to have continued to make losses thereafter. Nevertheless the petitioner estimates the fair value of his shares, which are of a nominal value of 1 each, to be 100 per share and alleges that, so far as he is aware, in the event of the company being wound up, there will be assets available for distribution amongst the shareholders. The petition concludes with the following allegation: "...your petitioner is unable to give accurate particulars of the present state of the company's financial affairs since at a board meeting of the company held on July 9, 1965, the majority shareholders purported t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been oppressed. In Scottish Co-operative Wholesale Society Ltd. v. Meyer [1959] AC 324; [1958] 3 WLR 404; [1958] 3 All. ER 66; [1959] 29 Comp. Cas. 1, HL (a case under section 210) Viscount Simonds L.C. adopted a dictionary definition of the meaning of "oppressive" as "burdensome, harsh and wrongful [1959] AC 324, 342." In Elder v. Elder Watson Ltd. 1952 SC 49, also a case under section 210, the Lord President, Lord Cooper, said Ibid. 55: ''...the essence of the matter seems to be that the conduct complained of should at the lowest involve a visible departure from the standards of fair dealing, and a violation of the conditions of fair play on which every shareholder who entrusts his money to a company is entitled to rely; " and Lord Keith said Ibid. 60: "... oppression involves, I think, at least an element of lack of probity or fair dealing to a member in the matter of his proprietary rights as a shareholder." These observations of Lord Cooper and Lord Keith have been cited with approval by the Court of Appeal in In re Harmer (H.R.) Ltd. [1959] 1 WLR 62; [1958] 3 All. ER 689, [1959] 29 Comp. Cas. 305 , CA. I turn to consider the allegations in paragraph ..... X X X X Extracts X X X X X X X X Extracts X X X X
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