Principle of statutory provisions:
Most of the cases in which the principle has actually been applied appear to fall within one of the following two classes:-
1. Where the company is defrauded
(i) Misappropriation of corporate property
- Like 'Menier v Hooper's Telegraph Works'
-and like 'Cook v Deeks'
(ii) Breach of duty by directors
-Alexander v Automatic Telephone Co.
Where the minority as individuals are defrauded
(i) Expulsion of minority
A purported expulsion of a member from the company will amount to fraud unless it is done bona fide and for the benefit of the company. The following cases are relevant:
-Dafen Tinplate Co. Ltd. v Llanelli Steel Co. Ltd.
-Brown v British Abrasive Wheel Co.
-Sidebotton v Kershaw Leese & Co
(ii) Inequitable use of majority power
Examples: Clemens v Clemens Bros Ltd. (99)