Landmark Company Law cases

Parent companies can owe direct duty of care to subsidiary's employees.

Parent company duty of care arguable: claims against RDS raised a real issue to be tried.

Turquand rule protects third parties from companies' internal irregularities

Pre-incorporation contracts create personal liability for promoters, not company liability.

A shareholder can sue to enforce voting rights when chairman wrongfully rejects votes

Companies cannot purchase their own shares without specific statutory authorization.

Liquidator may disclaim onerous contracts without leave of court under statutory power.

Preferential debts rank ahead of floating charges but after fixed charges in liquidation.

Minority members can sue when majority acts beyond constitutional powers ultra vires.

Shareholders cannot sue directors for negligence causing loss to the company alone.

Court establishes definitive test for apparent authority in company law

Directors cannot issue shares primarily to maintain control over the company.

Directors can act beyond powers if ratified by shareholders in general meeting.

Company secretaries have ostensible authority to bind companies in administrative matters.

Successful derivative action claimants can recover legal costs from the company.

Majority shareholders' votes are subject to equitable considerations protecting the minority

Corporate veil pierced where companies operated as single economic unit.

Corporate veil piercing requires exceptional circumstances beyond mere ownership and control.

Petitioner must demonstrate good faith and clean hands to obtain relief under s.459 Companies Act 1985

Directors are liable for wrongful trading when continuing business without reasonable prospect of avoiding liquidation.

Directors must exercise reasonable care but may receive statutory relief for honest mistakes.

Unfair prejudice requires breach of legitimate expectations based on actual agreements or understandings.

Courts apply strict criteria when validating post-petition transactions in winding-up proceedings.

Supreme Court restricts corporate veil piercing to evasion of existing obligations

Corporate veil pierced only when incorporation evades existing legal obligations.

Statutory limitation periods do not bar minority shareholder unfair prejudice petitions under Companies Act 2006