Unfair Prejudice Petitions – Shareholder Rights and Remedies
Shareholder Unfair Prejudice Petitions
This Legal Guide considers the right of a shareholder of a company to petition for relief against unfair prejudice under section 994 of the Companies Act 2006 (“CA 2006”) and the remedies available under section 996 of the CA 2006.
A shareholder of a company may petition the Court for relief where “the affairs of the company are being conducted in a manner that is unfairly prejudicial to the shareholder’s interests as a shareholder; or an actual or proposed act or omission of the company is or would be so prejudicial“.
Once the Court is satisfied that a petition under section 994 CA 2006 is well founded, it may make an appropriate order, which is most commonly for the shares of the petitioning shareholder to be bought by other shareholders of the company or even by the company itself.
Read our helpful Legal Guide for further details.