Multiple Derivative Actions in Company Law – Can You Or Can’t You? – New Square Chambers

Posted May 21st, 2013 in company law, derivative claims, fraud, news, subsidiary companies by sally

“It has long been recognised in English law that as an exception to the rule in Foss v Harbottle a member of a company may bring an action on its behalf against wrongdoers who exert control over the company and who are preventing it from enforcing its rights, i.e. the single derivative action. A multiple derivative action potentially arises where the proposed claimant is not a member of the wronged company but is a member of the ultimate holding company. Since the coming into force of the Companies Act 2006, there has been considerable debate as to whether that legislation removed the common law double derivative action or even, in some quarters, whether such a common law action ever existed.”

Full story (Word)

New Square Chambers, 17th May 2013