Family company owned and ran hotel.
Four directors were father and three sons.
Each held ¼ of shares.
One son wanted hotel to be sold and net proceeds of
sale distributed, but others disagreed.
He claimed hotel was initially acquired on understanding
that he would have final say on question of whether and when hotel would be
Claimed under s459 or s122(1)(g).
Jonathan Parker J –
Unfairness for purpose of s459 was to be judged
according to whether majority had acted in manner equity would regard as
contrary to good faith.
In case of quasi-partnership, exclusion of minority from
participation in management of company contrary to understanding on basis of
which company formed was clear eg of conduct equity would regard as contrary to
However, equity would not hold majority to an agreement,
promise or understanding which was not enforceable at law unless minority had
acted in reliance on it.
Jurisdiction under s122(1)(g) was not wider than
jurisdiction under s459.
Hence if conduct by majority was not unfair for
purposes of s459, could not found case under s122(1)(g).
In this case, no initial understanding of type argued
Even if there was, no reliance.
Hence no claim under either s459 or s122(1)(g).
[This case means there will be v little role for
s122(1)(g) in future, because s459 will always apply where s122(1)(g) does, and
can be used instead.