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England and Wales High Court (Chancery Division) Decisions |
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You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> Tonstate Group Ltd & Ors v Wojakovski & Ors [2019] EWHC 3363 (Ch) (05 December 2019) URL: https://www.bailii.org/ew/cases/EWHC/Ch/2019/3363.html Cite as: [2019] EWHC 3363 (Ch) |
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BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
BUSINESS LIST (ChD)
DERIVATIVE ACTION
Strand, London, WC2A 2LL |
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B e f o r e :
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(1) ![]() ![]() (2) ![]() ![]() (3) DAN-TON INVESTMENTS LIMITED (4) ARTHUR MATYAS |
Claimants |
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- and - |
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(1) EDWARD WOJAKOVSKI (2) TH HOLDINGS LIMITED (3) ![]() ![]() (4) SUMMERHILL CARDIFF LIMITED (5) ![]() ![]() (6) ![]() ![]() (7) ![]() ![]() (8) ![]() ![]() (9) ![]() ![]() (10) GLASGOW AIRPORT HOTEL HOLDINGS LIMITED (11) OVERSEAS HOLDINGS CAPITAL GROUP LIMITED (12) FIRSTSTAR LIMITED |
Defendants |
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Muhammed Haque QC (instructed by Candey Solicitors) for the 1st Defendant
Hearing dates: 20 November 2019
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Crown Copyright ©
Mr Justice Zacaroli:
The scope of the Duomatic
principle
"However, as I have already indicated, it does seem to me that not only Bowthorpe Holdings itself, but a number of other cases, including Cox v Cox, recognise the existence of a wider exception to the effect that a transaction can be impugned by the company if it is not honest, bona fide and in the best interests of the company. One explanation of that exception may be that public policy demands that a transaction which is not honest, bona fide and in the best interests of the company is not binding on the company. However, whatever the precise juridical basis of the wider exception, I consider that the claimants can show a serious issue to be tried that that exception applies here."
"In the present case payments were procured dishonestly; they were said to be for research and development when they were not; they were for the Defendants to have for themselves and to have in a way that dishonestly evaded the tax consequences. Whatever else may be the precise compass of the ReDuomatic
principle, as a principle developed to save conduct it has not been developed to save conduct of this nature. The company, the First Claimant, could not do lawfully what was done and the assent of all its members could not alter that. The principle is for transactions that are "honest": Parker and Cooper Ltd v Reading [1926] Ch 975 at 984 (per Astbury J) cited with approval in Randhawa and Another v Turpin and Another (as former Joint Administrators of BW Estates Limited) [2017] EWCA Civ 1021; [2018] Ch 511 at [56]-[57] (Court of Appeal; Sir Geoffrey Vos CHC)."