Monday, 25 June 2012

UK: England and Wales: permission to continue derivative claim granted

Earlier this month, in Phillips v Fryer [2012] EWHC 1611 (Ch), permission was given to continue a derivative claim under section 261 of the Companies Act 2006. The judgment is not yet available on BAILII but a short summary has been published by Lexisweb: see here. The shareholder seeking permission had already presented a petition under section 994 of the Companies Act 2006 in which he sought the repayment of sums to the company by those controlling it and an order that those shares he did not own were transferred to him. The existence of the section 994 petition did not, however, prevent the continuation of the derivative claim where, in the judge's view, the matter was largely one of case management and it was important to get the case quickly and economically before the court. (No date had been set for the section 994 hearing, the parties' preparation for which was unclear; the section 994 proceedings had started in September 2010).

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