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Journal of Business Law
2008
Publication Review
Minority Shareholders: Law, Practice and Procedure
Victor Joffe
David Drake
Giles Richardson
Daniel Lightman
Reviewed by Sue McLaughlin
Subject: company law
*J.B.L. 720 This, the third edition of a book first published in 2000, describes, in a well-written and
organised manner, the law, https://www.51lunwen.org/liuxuelunwendx/practice and procedure relevant to minority shareholder claims and
petitions in the courts of England and Wales, focusing on the popular unfair prejudice petition,
petitions for just and equitable winding-up and derivative claims. Owing to their legal systems having
different practices and procedures, Scotland and Northern Ireland are not covered.
The law is stated as at December 1, 2007 but, as with all company law texts appearing in this
transitional period, a decision has had to be made about how to deal with the fact that the Companies
Act 2006 is not yet fully implemented. The authors have adopted the forward-looking approach of
writing the text by reference to the provisions of the 2006 Act, directing readers to relevant
paragraphs of the second edition in relation to provisions not yet in force. Transition to the 2006 Act
and reflection of extensive case law development resulting in the inclusion of close to 100 new cases
make this a substantially changed book from the second edition published four years ago.
The features that mark this book out and make it a valuable contribution to legal scholarship on
shareholder rights are its focus on the practical and procedural dimensions of minority shareholder
petitions and claims and the sharing of practical experience by the authors. Accordingly, the book's
principal audience is practitioners, although its claritymakes it an accessible and useful text for
students with an interest in shareholder litigation. The forms, precedents, extracts from the Civil
Procedure Rules 1998 (as amended) (CPR) and Practice Directions included in the appendices are
particularly helpful aids to understanding how minority shareholders exercise their legal rights.
Turning to content, Ch.1 contains a clear explanation of the procedural stages of a derivative claim
and the relevant law, which has been simplified in some respects by derivative claims being placed
on a statutory footing. The review of the law on control of company litigation is particularly lucid. The
extensive review in this chapter of the question whether or not a shareholders' loss is recoverable,
known as the “no reflective loss principle”, is welcome, although given that this question is secondary
to whether or not a shareholder has a cause of action, potential confusion could arguably be avoided
by placing this discussion in Ch.2, on personal claims.
Acknowledging but refusing to be distracted by the absence of a comprehensive definition of what
constitutes personal rights of a member, the authors restrict Ch.2 to a review of the statutory contract
(previously s.14, now s.33), member objection to alteration of the articles, the extent to which
directors owe duties to members (rather than the company), and shareholders' agreements. Chapter
3, under the title “Rights conferred on shareholders by the Companies Act 2006”, reviews
shareholders' rights to object to the variation of class rights, in relation to company meetings,
inspection of registers, rect