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THE REPUBLIC OF TRINIDAD AND TOBAGO

IN THE HIGH COURT OF JUSTICE

Port of Spain

Claim No. CV 2017 -03422

BETWEEN

TRINIDAD AGGREGATE PRODUCTS LIMITED

Claimant/Applicant

AND

JEREN LIMITED

CARMEN REID

Defendants/Respondents

Before the Honourable Mme. Justice Jacqueline Wilson

Date of Delivery: February 7, 2019

APPEARANCES: Mr. Keith Scotland and Mr. Joel Roper Attorneys at law for the Claimant

Mr. Terrance Bharath and Mr. Shiv Sharma Attorneys at law for the First Defendant Mr. Seenath Jairam SC, Mr. Dharmendra Punwasee and Mr. Antonio Emmanuel Attorneys at law for the Second Defendant

RULING

1. On 19 July 2018 I made an order:

i. upholding the defendants’ preliminary objections to the

institution of these proceedings in the name of the

claimant company;

ii. dismissing the claimant’s Notice of Application filed on

28 September 2017 and the claim form and statement

of case filed on 6 October 2017; and

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iii. reserving my decision on costs to a date to be fixed by

the court.

2. The reasons for the decision are now given.

3. Mr. Peter Permell and Mr. Richard Saunders are the chairman and

deputy chairman, respectively, of the claimant’s board of directors.

The other directors are Mr. Terence Boswell Innis, Mr. Stephan Gift

and the second defendant, Ms. Carmen Reid. Ms. Reid is also the

claimant’s Managing Director.

4. Under the claimant’s bye-laws, its “A” class shareholders have the

power to appoint and remove its directors. The defendants are the

claimant’s “A” class shareholders. Ms. Renee Zamore is the director

and sole shareholder of the first defendant. The second defendant,

Ms. Carmen Reid, holds “A” class shares in her personal capacity and

as executrix of the estate of her deceased husband, Mr. Edsel Reid.

Mr. Edsel Reid was also Ms. Zamore’s father.

5. Messrs. Permell, Saunders and Gift have brought these proceedings

in the name of the company seeking an injunction to restrain the

defendants from removing them as directors.

6. The primary issue for determination is whether they had the

requisite authority to bring the proceedings.

HISTORY OF DEVELOPMENTS

7. The proceedings were first instituted on 27 September 2017 when

the claimant filed an ex parte application for an injunction to restrain

the defendants from convening a meeting of shareholders to

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consider the removal of Messrs. Permell and Saunders as directors.

The developments giving rise to the application are set out below.

8. In or around August 2017, the defendants requested Messrs. Permell

and Saunders to resign as directors on the assertion that their

resignation would facilitate the negotiation and sale of the claimant’s

shares. Messrs. Permell and Saunders did not immediately agree to

resign and convened a board meeting on 16 August 2017 to discuss

the defendants’ request. A day prior to the meeting, the defendants

passed a resolution removing Messrs. Permell and Saunders as

directors and appointing new directors to replace them. They also

cancelled the board meeting that was scheduled for the following

day.

9. Messrs. Saunders and Permell informed the defendants that their

removal as directors was invalid as the meeting of “A” class

shareholders at which the decision was taken was not duly convened.

They asserted that under bye-law 12.2 of the company’s bye-laws

and section 133 of the Companies Act1, the claimant’s “A” class

shareholders must first requisition the directors to call a meeting of

shareholders for the purposes stated in the requisition and may

themselves call the meeting only if the directors failed to do so within

twenty-one days of receiving the requisition.

10. Messrs. Saunders, Permell and Gift proceeded with the board

meeting on 16 August 2017 at which a decision was taken to

terminate the second defendant’s contract as Managing Director

with immediate effect. The second defendant did not accept the

termination as valid, having regard to the purported removal of

Messrs. Permell and Saunders as directors the day before.

1 Chapter 81:01

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11. On 17 August 2017 Messrs. Permell, Saunders and Gift made efforts

to meet with the claimant’s senior management team to apprise

them of developments but were denied access to the claimant’s

premises.

12. On 24 August 2017 the defendants issued a requisition to the

directors for a special meeting of “A” class shareholders to consider

resolutions for the removal of Messrs. Permell and Saunders as

directors and for the appointment of Ms. Renee Zamore and Mr.

Dave Ramkissoon to replace them.

13. On 7 September 2017 four of the claimant’s directors, Messrs.

Permell, Saunders, Gift and Inniss met to consider the requisition.

Ms. Reid was not present at the meeting. A number of key decisions

were taken, including a decision to terminate Ms. Reid’s

appointment as Managing Director with immediate effect

(notwithstanding the earlier termination on 16 August 2017). Mr.

Innis objected to the decision but Messrs. Permell, Saunders and Gift

voted in favour of it. Another decision was taken to change the

quorum of directors for board meetings from four to three. Mr.

Inniss once again took objection, but the motion was similarly passed

by Messrs. Permell, Saunders and Gift.

14. The minutes of the meeting of 7 September 2017 reflect that the

proposal to reduce the quorum from four to three was based on the

perceived difficulty, expressed by Mr. Permell, in obtaining a quorum

of four directors. It was also agreed that the Special Meeting of “A”

class shareholders requested by the defendants would be convened

on 2 November 2017. Mr. Innis objected to the proposed date and

suggested that the meeting be called within 7 days having regard to

the urgency of the matter. However, his proposal was defeated by

Messrs. Permell, Saunders and Gift.

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15. Subsequent to the board meeting of 7 September 2017, Messrs.

Permell, Saunders and Gift made efforts to gain access to the

claimant’s premises but those efforts were again denied by the

claimant’s security personnel. Thereafter, the defendants re-

scheduled to 20 September 2017 the Special Meeting of “A” class

shareholders that was fixed by the board for 2 November 2017. At

the re-scheduled meeting they passed a resolution removing Messrs.

Permell and Saunders as directors and appointing new directors to

replace them. A notice of change of directors was filed with the

Registrar of Companies the same day.

16. These developments precipitated the application for an injunction

brought by Messrs. Permell, Saunders and Gift on behalf of the

company. Messrs. Permell and Saunders contend that their removal

as directors was inconsistent with the company’s bye-laws and the

Act and that the defendants have “forcibly taken control of

the…company.”

THE PROCEEDINGS

17. The claimant’s ex parte application for an injunction came on for

hearing before me on 28 September 2017. It was supported by the

affidavit of Mr. Permell sworn on 27 September 2017. The claimant

sought the following relief:

1. An injunction restraining the Defendants/Respondents

whether acting by themselves, their servants and/or

agents from convening a special meeting and/or any

meeting of the shareholders of the Claimant to consider

any matter pertaining to the removal and/or

appointment of any member of the Board of Directors

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of the Claimant until the determination of this matter or

until further order;

2. An injunction restraining the Defendants/Respondents

whether acting by themselves, their servants and/or

agents from refusing and/or denying any member of the

Claimant’s Board of Directors listed on the Companies

Register as at July 2017, access to the premises and/or

principal place of business of the Claimant until the

determination of this matter or until further order;

3. An injunction restraining the Second Defendant/

Respondent whether acting by herself, her servants

and/or agents from holding herself to be a Director

and/or the Managing Director of the Claimant and/or

purporting to issue such instructions and/or purporting

to make such decisions and/or enter into and/or rescind

such contracts that relate to the legitimate holder of

office of Director until the determination of this matter

or until further order;

4. An Order under Part 135 of the Companies Act, Chapter

81:01 restraining the Defendants from appointing

and/or removing the Chairman and Deputy Chairman as

Directors until the determination of this matter or until

further order;

5. That the Defendant do pay the costs of this application.

18. At the hearing on 28 September 2017, I gave directions to the

claimant to serve the application on the defendants and to file and

serve the substantive proceedings in respect of which the injunction

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was sought. The hearing was adjourned to 11 October 2017 to give

the defendants an opportunity to heard.

19. On 6 October 2017 the claimant filed a claim form and statement of

case. The relief sought in the claim form mirrored the relief sought

in the injunction application. The claimant sought the following

orders:

1. A declaration that the Defendants whether by acting by

themselves and/or through their servants and/or agents

or otherwise are not authorized by Section 133 of the

Companies Act, Chapter 81:01, or the bylaws of the

Defendant to institute and/or continue and/or to hold a

special meeting and/or any meeting until the

determination of this matter or until further order;

2. A declaration that any decision of the Defendant

through its shareholders and conveyed to the Claimant

prior to the convening of a special meeting on the 2nd

November, 2017, to purportedly remove the Claimant

is ultra vires, null and void, and inconsistent with the

Defendant’s byelaws;

3. A declaration that on a true interpretation of the

Defendant’s bylaws that the Chairman and Deputy

Chairman of the Claimant cannot be removed from

office in the matter conducted by the defendants as

shareholders and/or through persons so authorized by

them;

4. A declaration that any decision taken and/or instruction

issued by the defendants that touches and concerns the

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business and/or operations of the Claimant with effect

from the 20th September, 2017 is ultra vires, null and

void and of no effect.

20. The defendants appeared at the hearing on 11 October 2017. Each

of them had filed an affidavit the day before. At the hearing, Counsel

for the defendants stated their intention to challenge, by way of

preliminary objection, Mr. Permell’s authority to bring proceedings

in the name of the company. I gave directions for the defendants to

file and serve written submissions in support of their preliminary

objection and for the claimant to file and serve written submissions

in reply. The hearing of the preliminary objection was adjourned to

23 October 2017.

21. In the intervening period, the parties proceeded to file further

affidavits up to and including the day of adjourned hearing. At the

hearing I heard arguments on the defendants’ preliminary objection

and other procedural arguments raised by Counsel. The preliminary

objection was strongly opposed by the Counsel for the claimant.

22. On 8 February 2018, I determined that, having regard to the

multiplicity of affidavits filed in the proceedings, the objections

raised by the defendants required full ventilation and should not be

determined summarily on the basis of untested evidence at a

preliminary stage of the proceedings.

23. Thereafter, the substantive proceedings were adjourned to 9 May

2018 and directions were given to the parties to formulate the issues

for determination by the court. The parties proceeded to file further

affidavits. At the hearing the following nine affidavits were before

the court:

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1. The affidavits of Mr. Peter Permell sworn on 27

September 2017 and 28 March 2018;

2. The affidavit of Mr. Stephan Gift sworn on 23 October

2017

3. The affidavit of Mr. Richard Saunders sworn on 23

October 2017

4. The affidavits of Ms. Renee Zamore sworn on 10

October 2017 and 14 March 2018; and

5. The affidavits of Ms. Carmen Reid sworn on 10 October

2017, 20 October 2017 and 12 March 2018.

24. The parties identified the following issues as relevant for

determination:

1. If Messrs. Peter Permell and Richard Saunders were not

removed as directors of the claimant by resolution

passed at the Meeting of “A” Class Shareholders held on

20 September 2017, could they along with Mr. Stephan

Gift subsequently pass a binding resolution authorising

the bringing of an action in the name of the Company?

2. Whether the filing of a Notice of Change of Directors on

20 September 2017 gave rise to the presumption that

Messrs. Permell and Saunders had been properly

removed as directors with the result that in the

circumstances of this case, any challenge to their

removal ought to have been initiated by them (or either

of them) in their personal capacity?

3. Assuming these proceedings have been properly

brought, whether these proceedings ought to be

dismissed on the basis that the court will not interfere

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where the claimant seeks to impugn a decision on the

basis that it was arrived at without due compliance with

the company’s bye-laws, if the company given the

opportunity, could at any moment properly make the

decision which the claimant seeks to impugn?

4. Can injunctive relief pursuant to section 133 and 135 of

the Companies Act Ch 81:01 be sought by either Messrs.

Permell or Saunders in the form of an action where the

name of the Claimant Company is used to advance the

litigation as opposed to the individual names of Messrs.

Permell, Saunders or Gift?

5. If the answer to 4 above is yes, have Messrs. Permell,

Gift or Saunders demonstrated sufficiently by

admissible evidence that the action herein was legal

authorised?

25. It is immediately apparent that the central point that underpins all of

the above the issues is whether the institution of these proceedings

was duly authorised by the company. Additionally, having regard to

the similarity of the relief sought in the injunction application and the

substantive claim, a decision on the injunction application would be

determinative of the substantive claim.

THE EVIDENCE

26. Messrs. Permell, Saunders and Gift assert that they are the bona fide

directors of the company and that the quorum for board meetings

was changed from four to three, in accordance with paragraph 4.3 of

the claimant’s bye-laws. They state that a quorum of three directors

duly authorised the filing of the proceedings and that they were

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unable to hold a formal meeting given the urgency of the matter,

having received notice of the change of directors by registered mail

the very day on which the proceedings were filed.

27. In his affidavit sworn on 28 March 2018 Mr. Permell provided details

of the circumstances giving rise to the request for his resignation. He

stated that, by letter dated 8 August 2016 some of the claimant’s

shareholders wrote to him expressing concern about the claimant’s

precarious financial circumstances and the poor management of its

Managing Director. The letter criticised Mr. Permell’s failure, as

Chairman, to address the ongoing concerns and attributed his

inaction to a lack of security of tenure as, under the company’s bye-

laws, he could be removed at the will of the “A” class shareholder

who appointed him. The letter called on Mr. Permell to either resign

as chairman or take steps to sell the company’s shares at a

competitive price. The letter also sought the removal of Ms. Reid as

Managing Director and the recruitment of a suitable replacement.

28. In his response to the shareholders’ letter, Mr. Permell refuted many

of the shareholders’ allegations. He also made it clear that while the

request to remove Ms. Reid as Managing Director would be included

in the Notice of Annual meeting scheduled for 27 April 2017, the

proposal did not have the approval of the board.

29. At the Annual Meeting there were detailed discussions regarding the

proposal to remove Ms. Reid as Managing Director. It was ultimately

decided that the proposal would not be put to a vote as the authority

to remove the Managing Director resided with the board and not the

shareholders.

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30. On 28 April 2017, the shareholders’ representative wrote to Mr.

Permell condemning the approach taken by the board at the Annual

Meeting and calling upon board members to resign.

31. A month later, on 24 May 2017, Mr. Permell received an expression

of interest in the company from a competitor. The competitor

requested a visit to the company’s facilities and other information in

order to make a firm proposal. Mr. Permell informed board

members of the request and a special meeting of shareholders was

convened in June 2017 to consider the matter.

32. On 5 July 2017, some of the claimant’s shareholders, including Ms.

Reid, wrote to the directors offering the sale of their shares in order

for the proposed sale to proceed. The directors convened a board

meeting on 14 July 2017 to discuss the shareholders’ offer. Ms. Reid

was not present at the meeting. The directors decided that a

valuation of the company’s shares should be undertaken by its

auditors to determine the way forward.

33. On 26 July 2017, Mr. Permell received an email from Ms. Zamore, the

director of the first defendant, reporting that a month-long

shutdown of the company’s operations was rumoured to begin the

following day. Less than a week later, Mr. Permell received further

correspondence from Ms. Zamore reporting that Ms. Reid was

engaging directly in discussions with a competitor for the sale of the

company. Ms. Zamore sought confirmation that a sale would not

proceed until the competitor’s offer was made known to the

shareholders.

34. In her affidavit sworn on 12 March 2018 Ms. Reid gave her account

of events. She states that in late July 2017, the claimant’s “A” Class

shareholders held discussions regarding the restructuring of the

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board of directors as they wished to ensure that board members

were shareholders of the company and were thereby “directly

invested” in its future. The “A” class shareholders met on 15 August

2017 and passed resolutions to remove Messrs. Permell and

Saunders as directors and to replace them with new directors.

35. The “A” class shareholders subsequently received legal advice that

the meeting of 15 August 2017 was not duly convened and the

resolution to remove Messrs. Permell and Saunders as directors was

invalid. Based on that advice, the “A” class shareholders requested

the board of directors to convene a meeting of “A” class shareholders

for the purpose of removing of Messrs. Permell and Saunders as

directors.

36. Ms. Reid did not attend the board meeting that was convened on 7

September 2017 to discuss the shareholders request but was

informed by Mr. Inniss of the decisions taken at the meeting,

including the decision to terminate her appointment. As a result, she

advised the claimant’s senior managers that Messrs. Permell,

Saunders and Gift were no longer allowed on the compound in order

to prevent disruptions to the claimant’s business operations.

37. On 15 September 2017 Ms. Reid received notice that the special

meeting of “A” class shareholders was scheduled by the board for 2

November 2017. The “A” class shareholders unanimously agreed to

re-schedule the meeting to 20 September 2017 and to waive notice

of the re-scheduled date. The meeting was purportedly re-scheduled

as a result of concerns regarding “the obvious attempt by Messrs.

Permell, Saunders and Gift to hijack the board of directors and

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management of the claimant” and to take immediate steps to avoid

any financial and/or reputational damage.2

38. Ms. Reid states that neither she nor Mr. Inniss received notice of the

informal meeting at which the decision was taken by Messrs.

Permell, Saunders and Gift to bring these proceedings. Together

with Ms. Zamore, she asserts that the “A” Class shareholders do not

intend to re-appoint Messrs. Permell and Saunders to the board of

directors and would take appropriate measures to remove them in

the event that the proper procedures had not been followed.

THE ARGUMENTS

39. Counsel for the Claimant submitted that the unlawful removal of

Messrs. Permell and Saunders as directors lies at the heart of the

proceedings and that the illegality arises by virtue of the defendants’

breach of the claimant’s bye-laws and the contravention of section

133 of the Companies Act.

40. Counsel submitted that section 133 of the Act sets out the

procedures under which the shareholders of a company with the

right to vote may requisition a meeting of directors to transact the

business stated in the requisition. It is supported by the provisions

of bye-law 12.2 which provide for the convening of meetings by the

company’s directors upon receipt of a requisition under section 133.

41. Counsel argued that in bringing the proceedings Mr. Permell was

acting for and on behalf of the company and not in his personal

capacity and that, as a bona fide director of the company he was duty

2 See paragraph 47 of affidavit

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bound to act in its best interests. Counsel submitted that the

absence of a board resolution authorising the institution of the

proceedings did not affect the validity of the decision, as the decision

could easily have been ratified at a subsequent meeting.

42. Counsel submitted that the proceedings were brought as the

defendants had embarked on a course of conduct that was causing

the claimant to carry on business in a manner prejudicial to the

interests of the company, its ordinary shareholders and employees,

and in breach of the principles of good governance and the

requirements of the Companies Act.

43. Counsel for the first defendant argued that section 135 of the Act

made a distinction between a company and its shareholders and

directors and did not permit a director or shareholder to bring

proceedings on behalf of a company.

44. Counsel argued that there was no board resolution authorising the

company to bring these proceedings and that the proceedings were

no more than a personal grievance by Messrs. Permell and Saunders

challenging their removal as directors by the “A” Class shareholders

in circumstances which they disputed.

45. Counsel argued that in the absence of a resolution by a company’s

board of directors or the appropriate delegation of powers, a single

director of a company had no authority to instruct solicitors to

institute proceedings on behalf of the company: Mitchell v Hobbs

(UK Ltd) v Mill [1996] 2 BCLC 102.

46. Counsel submitted that Mr. Permell had not demonstrated how his

alleged wrongful removal as chairman and director adversely

affected the best interests of the company and that it was untenable

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to suggest that the company had a right for him to remain as

chairman.

47. Counsel for the Second Defendant argued that the purported change

of the claimant’s quorum from four to three directors was contrary

to the provisions of the bye-laws and therefore illegal and void.

Counsel argued that the board of directors could not alter the

quorum as they sought to do at the meeting of 7 September 2017 as

no notice was given that the proposed alteration of the quorum

formed part of the business to be transacted at the meeting.

48. Counsel cited the decision of Barrett J in Dhami v Martin [2010]

NSWC 770 at paragraph 51, where it was stated that:

“Where there is a requirement that the notice convening a

meeting state the purpose of the meeting or the business

proposed to be transacted, the position is as stated in Mc Lure v

Mitchell (1974) 24 FLR 115 at 140:

“The purpose of a notice of a meeting is to enable

persons to know what is proposed to be done at the

meeting so that they can make up their minds whether

or not to attend. The notice should be so drafted that

ordinary minds can fairly understand its meaning. It

should not be a tricky notice artfully framed (Henderson

v Bank of Australia (1890) 45 CH.D. 330 at 337)”.

49. Counsel for the second defendant argued that the decision by

Messrs. Permell, Saunders and Gift to institute the proceedings was

made without notice to Mr. Innis or Ms. Reid, who were thereby

excluded from participating in the decision. Counsel contended that

the approach taken was in breach of the bye-law 4.1, under which

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the claimant’s business must be managed by its board of directors,

and bye-law 6.2, under which directors are entitled to notice of a

meeting of the board.

50. Counsel argued that in the absence of the required notice, the

decision to institute the proceedings was unlawful, null and void. In

support of the argument, Counsel cited the following extract from

the text, Company Directors, Duties Liabilities and Remedies 3rd ed,

where Mortimore QC noted at para. 5.19 that:

“A director cannot lawfully be excluded from a board meeting,

and an excluded director can obtain an injunction restraining his

continued exclusion (unless he is about to be removed, in which

case an injunction would be pointless). Where notice is not

received by every director so entitled, business done at that

meeting does not bind the company and ‘the failure to give

requisite notice is an irregularity.’ This is so, even where

directors without notice could not have changed the result.”

DISCUSSION

51. The authorities postulate that in the absence of a delegation of

authority, a company’s board of directors must authorise the

commencement of proceedings by the company: Fusion Interactive

Communication Solutions Ltd v venture Investment Placement Ltd

(No. 2) [2005] EWHC 736 (Ch); Mitchell & Hobbs (UK) Ltd v Mill

[1996] 2 BCLC 102.

52. It is not disputed that there was no delegation of authority to Messrs.

Permell, Saunders or Gift to institute proceedings on behalf of the

company. They assert that the decision was properly taken by them

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in circumstances where urgent and immediate action was required

to protect the interests of the company.

53. The decision was made at an informal meeting of which no notice

was given to other members of the board, namely Ms. Carmen Reid

and Mr. Terence Boswell Innis. Counsel for the claimant asserts that

the failure to pass a resolution for the institution of the proceedings

does not invalidate the decision to bring the proceedings as the

decision could be ratified at a duly convened board meeting.

54. I do not accept Counsel’s argument in this regard. The validity of the

business transacted at a meeting, whether convened formally or

otherwise, is dependent upon whether due notice of the meeting

was given and whether the meeting was quorate. The validity does

not turn upon a potential ratification by the claimant’s board.

55. Under the claimant’s bye-laws, due notice of a board meeting must

be given to each director.3 The purpose of notice is to enable persons

to know what business is proposed to be conducted at the meeting

so that they can determine whether they wish to attend. The

objective is to facilitate collective deliberation and informed decision

making of the board as a whole. Otherwise it would be possible for

some directors to meet and transact business that may not receive

the concurrence of other directors: Dhami v Martin [2010] NSWSC

770.

56. In Dhami (supra), at para. 54, Barrett J of the Supreme Court of New

South Wales held that:

3 Bye-law 6.2

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“The power to convene (board meetings)… is not a personal

proprietary right to be used for the director’s own ends. It is a

power to facilitate the obtaining of an expression of the will of

the board of directors.”

57. The claimant’s bye-laws provide that the quorum for the conduct of

board meetings is four and that no effective board meeting could be

held where the directors present fall below this number.4 The bye-

laws give the directors power to act where their number falls below

four only for the purpose of filling vacancies.5 Therefore, a quorum

of three directors could not, without more, exercise the collective

powers of the board to authorise the institution of legal proceedings.

58. The question that arises is whether the decision by Messrs. Permell,

Saunders and Gift to reduce the quorum of directors from four to

three was validly taken. Mr. Permell’s evidence is that the decision

was made to overcome the difficulty in convening meetings of four

directors. There is nothing in the evidence to support Mr. Permell’s

contention. Notwithstanding the indications that Ms. Reid

deliberately absented herself from board meetings to prevent a

quorum from being constituted, all of the board meetings in

question, save for the informal meeting at which the decision was

taken to institute these proceedings, were attended by no less than

four of the claimant’s directors.

59. The claimant’s bye-laws do not provide for an ad hoc reduction in the

prescribed quorum in circumstances that are otherwise undefined.

The combined provisions of bye-law 4.2, under which the number of

directors is fixed between five and nine, and bye-law 6.3, under

which the quorum for the transaction of business is fixed at four,

4 Bye-law 6.3 5 Bye-law 4.9

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suggest that the company’s decisions are intended to reflect the

collective will of a majority of its directors and not the interests of a

minority.

60. Mr. Permell’s assertion that the decision to institute these

proceedings was made to protect the interests of the company

requires examination. The evidence suggests that Messrs. Permell,

Saunders and Gift felt constrained to act in the face of mounting

criticism by shareholders regarding the poor management of the

company and grave concerns about its diminishing profitability.

There was a complete breakdown in the relationship between the

Managing Director and Messrs. Permell and Saunders, giving rise to

polarized board with two competing factions – namely, Messrs.

Permell, Saunders and Gift on the one hand and Mr. Boswell Innis

and Ms. Reid on the other. There is no doubt that the ongoing

oversight of the company by the board was difficult, if not

impossible, in the prevailing circumstances.

61. The “A” class shareholders made it clear that they no longer wished

Messrs. Permell and Saunders to remain as directors and made

persistent efforts to remove them and to appoint replacement

directors. Messrs. Permell and Saunders responded by initiating

proceedings to prevent their removal and found support in Mr. Gift.

62. Notwithstanding the pre-emptive action taken by them to prevent

their removal, Messrs. Permell and Saunders have failed to indicate

how their continued appointment as directors was necessary to

protect the best interests of the company or to prevent any actual or

threatened interference with the company’s best interests by Ms.

Reid or Mr. Boswell Innis.

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63. For all of the above reasons, I considered that the decision to

institute these proceedings was not the decision of the company’s

board and was not authorised by the company.

64. The proceedings were therefore dismissed.

65. Having heard the parties on costs on 7 February 2019, it was ordered

that:

a. Messrs. Permell, Saunders and Gift do pay:

i. the defendants’ prescribed costs of the claim; and

ii. the costs of the Notice of Application filed on 28

September 2017 including the hearing of the

defendants’ preliminary objections;

b. The costs referred to in (ii) above shall be assessed by the

Registrar in default of agreement.

c. Leave be granted to Messrs. Permell, Saunders and Gift to

appeal the order as the costs.

Jacqueline Wilson

Judge