Fraud on the minority, Business Law and Ethics

Fraud on the minority:

The exception of "fraud on the minority" depends, whereas the company is defrauded, on "wrongdoer control," i.e. the individual shareholder must show that the wrongdoers control the company, as where they control the board and general meetings and will not permit an action to be brought in the company's name.  Furthermore, wrongdoer control is essential because cases of misappropriation of property and breach of duty can be ratified by a 51 per cent majority of the members which is not controlled by the wrongdoers.

The wrongdoers will obviously be in the above position if they have voting control as they had, for example, in Menier and Cook.  However, in Prudential Assurance Co. Ltd. v Newman Industries Vinelott, J. held that de facto control was enough, i.e. the company does what the wrongdoers want even though the wrongdoers do not have voting control.  They are able to persuade the majority to follow them.

Posted Date: 1/15/2013 2:56:43 AM | Location : United States







Related Discussions:- Fraud on the minority, Assignment Help, Ask Question on Fraud on the minority, Get Answer, Expert's Help, Fraud on the minority Discussions

Write discussion on Fraud on the minority
Your posts are moderated
Related Questions
Duty of an auditor: The duty of an auditor generally was very carefully considered by this court in RE: LONDON AND GENERAL BANK (1895) and I cannot usefully add anything to wh

Question 1 - Hatfield owned a large farm on which he grew grain. His combine was inadequate in relation to the acreage of grain that he harvested annually. As a result, on seve

Power to dispense with the word "Limited":                             Although s.5 provides that the last word of the name of a limited company must be "limited" this would n

Analyze the differences between a proposal and an invitation to treat and discuss the rules to determine the point of time on which an agreement is reached. Using the latest Malays

Directors' Remuneration: For technical reasons the directors are not regarded as servants or employees of the company of that they are directors. Therefore  here they have no

Removal:             Article 107 provides that the managing director's "appointment shall be automatically determined if he cease from any cause to be a director". However it

Presumed Agency or from Cohabitation Whether a woman who is living with a man is deemed that  be his agent for purposes of acquire necessaries to the family; marriage is not n

What are the disadvantages of doctrine of judicial precedent? Disadvantages of doctrine of judicial precedent: • Overtime here has been a huge number of cases, makes this ve

Question 1: Mr Ben is the director of ABC Ltd. He wishes to know whether he has any responsibility under the OSHA regarding the presence of the following in his enterprise:

Contingent and prospective liabilities of the company: A creditor who petitions on grounds of the company's insolvency may rely on any of the following situations to show (as