John Seneschall v Trisant Foods Limited (in liquidation) & Ors
[2023] EWHC 1029 (Ch)
John Seneschall v Trisant Foods Limited & Ors
11 March 2024
[2024] EWHC 456 (Ch)
High Court
Several people plotted to push someone out of their company, secretly using the person's house as collateral for a loan. The court said this was unfair. The court decided the company was already failing, so the person wasn't paid for their shares but was freed from their loan responsibility and received money for legal fees from the wrongful dismissal. They didn't get paid for lost wages.
Key Facts
- •Unfair prejudice petition under s. 994 of the Companies Act 2006.
- •Claim of unlawful means conspiracy.
- •Split trial: liability and remedies.
- •Petitioner (Seneschall) sought share purchase order, compensation, and damages.
- •Respondents (Trisant Foods Ltd, Market Fresh Ltd, Jones, Marshall, McCormick) appeared in person.
- •Company (Trisant Foods Ltd) was insolvent and in liquidation.
- •Respondents' plan to exclude Seneschall from the company.
- •Dishonest concealment of plan from Seneschall.
- •Valuation of Seneschall's shares as a key issue.
- •Petitioner's argument for a counterfactual negotiation to determine share value rejected.
Legal Principles
Court's wide and flexible powers under s. 996 of the Companies Act 2006 to give relief for unfair prejudice.
Companies Act 2006, s. 996
Remedy for unfair prejudice should be proportionate and not punitive.
Re Phoenix Office Supplies Ltd [2003] B.C.C. 11; Hawkes v Cuddy [2008] B.C.C. 390
Court can make any order it deems fit, even if not specifically requested by petitioner.
Hawkes v Cuddy [2008] B.C.C. 390
Damages for unlawful means conspiracy are 'at large'.
Noble Resources SA v Gross [2009] EWHC 1435 (Comm)
In unlawful means conspiracy, claimant must show actual damage caused by the conspiracy.
Lonrho Plc v Fayed (No.5) [1993] 1 W.L.R. 1489
Outcomes
Share purchase order made against Market Fresh and Marshall (jointly and severally), Jones (proportionately to her shareholding), but not McCormick.
Market Fresh and Marshall were central to the plan to exclude Seneschall; Jones' involvement was less significant; McCormick was a mere employee.
Petitioner granted relief equivalent to release from personal guarantees and security (Reward Loan, etc.).
To achieve a clean break and remedy the unfair prejudice caused by the dishonest exploitation of Seneschall's assets.
Claim for 'termination payment' refused.
Based on rejected counterfactual negotiation and lack of evidential basis.
Damages awarded for legal fees incurred in disciplinary and Employment Tribunal proceedings.
Fees directly attributable to the conspiracy, wrongful suspension, and dismissal.
Claim for lost earnings refused.
Not demonstrated that loss was caused by the conspiracy; failure to mitigate loss.
Valuation of Seneschall's shares set at £nil.
Based on expert evidence that the company had nil or nominal value at the valuation date due to insolvency and lack of reliable forecasts.