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Unfair Prejudice Claims

Why are claims lodged?

Section 994 of the Company’s Act 2006 provides minority shareholders with a level of protection against the actions of the directors of the company, when they are considered to be prejudicial or unfair to the shareholder(s). Should a shareholder conclude that their interests have been prejudiced due to the behaviour of a director when undertaking company affairs, and subject to having taken the appropriate advice, they are able to lodge an unfair prejudice claim. 

This is a complex area of law, in part due to the fact that there is not an exhaustive list of behaviours which constitute unfair prejudice. Furthermore, the petitioner must be able to show that the action committed by the director was both prejudicial and unfair. Each case will be decided on its own merits and the facts the petitioner can testify to.

Professional and specialist support

Unfair prejudice claims often require detailed financial analysis in support or in defence of the petition. Our team of specialists can provide full support to the legal team and counsel throughout the petition, from analysing multiple transactions to company/shareholding valuations to providing support at pre-action meetings/mediation and attending any court proceedings.

We are also able to advise on the alternatives to unfair prejudice claims and whether there is potentially a more appropriate course of action to take in order to remedy the situation.

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