COMPANY

Beneficial interests - pre-emption rights - rectification - registers of members - shareholders - share transfers - rectification of register of members - transfer notices - articles of association - waiver

Claygreen Ltd sub nom Ruth Margaret Romer-Ormiston v (1) Claygreen Ltd (2) Leonard David James Wallis (3) Andrea Gillian Burns (4) RDB Investments Ltd (2005): ChD (Companies Ct) (Peter Prescott QC): 21 September 2005



The applicant (R) applied under section 359 of the Companies Act 1985 for rectification of the register of members of a company (C) to show her as the owner of 33 of the 99 issued shares in C that had formerly been registered in her name. C held land at Greenwich that it wished to develop.


The two directors of C were a husband and wife, who held 33 shares between them. A fourth shareholder held the other 33 issued shares. C's articles of association contained pre-emption provisions. R wished to sell her 33 shares in C in order to raise money to repay a loan. R wished to sell the shares to a third party (Epsom) and sought to obtain the other shareholders' consent to waive their pre-emption rights.


R gave a power of attorney to her accountant and executed a share transfer form in blank. The accountant then informed the company by letters that R had agreed to transfer and had transferred the shares and asked for a general meeting to be called to approve the registration of the shares in the name of Epsom. The accountant did not specify the price for which the shares had been transferred. C treated the accountant's letters as a transfer notice triggering the rights of pre-emption under its articles. The shares were accordingly valued by the auditors and offered and allocated to the other members pro rata.


Michael Ashe QC, Timothy Sisley (instructed by CooperBurnett) for the claimant; Jonathan Gavaghan (instructed by Blake-Turner & Co) for the defendants.


Held, the accountant's letters did not constitute a transfer notice under C's articles of association. A transfer notice under the articles had to state that an intending transferrer desired to transfer the shareholding and had to state the intended transfer price. The first of those statements had to be unconditional. The two requirements were not to be regarded in isolation. A shareholder who really wished to exhaust the pre-emption provisions would normally state the transfer price. If the shareholder did not do so, it might indicate that the first statement was not unconditional. The letters were not an unconditional statement that R intended to part with her shares. The business sense of the communications was to have Epsom registered in succession to R if the necessary unanimous consent to waive the pre-emption provisions was forthcoming. The requirement to state the transfer price was not for the sole benefit of the other members so that an omission to fulfil that requirement might be waived by them. No interest in R's shares had been transferred to Epsom. The purported transfer of R's shares to Epsom was forbidden by the articles of which Epsom was to be taken to have had notice. The articles intended to forbid the existence of a beneficial interest separate from outright ownership and to prevent transfer in breach of the pre-emption provisions.


R was entitled to be restored to the register and there was no reason to exercise the discretion under section 359 adversely to her. Application granted.






IMMIGRATION


Asylum support - children - withholding and withdrawal of support - ineligibility for support - support for children

R (on the application of B) (claimant) v (1) Asylum Support Adjudicator (2) Secretary of State for the Home Department (Defendants) & V (interested party) (2005): QBD (Admin) (Michael Supperstone QC): 19 September 2005


The interested party (V) sought a declaration that the Nationality, Immigration and Asylum Act 2002 schedule 3 paragraph 2(1)(b) preserved the duty of the secretary of state to provide asylum support, pursuant to section 122 of the Immigration and Asylum Act 1999, to the child of a person when that person ceased to be eligible for asylum support under section 95 of the 1999 Act.


The claimant (B) was a citizen of the Czech Republic. He had claimed asylum but that claim had been refused. He lived with his wife (V) and three children. When the Czech Republic became a European Economic Area state in 2004, B became ineligible for asylum support by the operation of section 54 of and schedule 3 to the 2002 Act. The home secretary then indicated that the provision of asylum support to B and his dependant would be terminated. V submitted that Parliament's intention, by enacting paragraph 2(1)(b) of schedule 3 to the 2002 Act, had been to exempt children from the effect of schedule 3.


Parishil Patel (instructed by the Treasury Solicitor) for the second defendant; Simon Cox (instructed by the Rights Partnership) for the interested party.


Held, the duty of the secretary of state under section 122 of the 1999 Act to provide asylum support to a child of a person was dependent on that person being eligible for asylum support under section 95.


Since B was no longer eligible, the home secretary's duty under section 122 to B's children did not arise. It was not a question of whether the effect of schedule 3 to the 2002 Act ended the section 122 duty, rather that the duty did not arise because the conditions for its operation were not met. Such an interpretation did not affect the child's eligibility for support and assistance for example under section 17 of the Children Act. Application refused.