Amin and Another v Amin & Others
| Jurisdiction | England & Wales |
| Judge | Mr Justice Warren |
| Judgment Date | 16 March 2010 |
| Neutral Citation | [2010] EWHC 528 (Ch),[2009] EWHC 3356 (Ch) |
| Court | Chancery Division |
| Docket Number | Case No: HC05C00480,Case No: HC05C00480, 4833 of 2005 |
| Date | 16 March 2010 |
[2009] EWHC 3356 (Ch)
Mr Justice Warren
Case No: HC05C00480
Number 4833 of 2005
Mr T Sisley and Mr J O'Mahony (instructed by Messrs Magwells) for the Claimants
Mr P Talbot QC and Mr D McCourt Fritz (instructed by Messrs Stephenson Harwood) for the First,Ninth,Tenth, and Seventeenth Defendants
Mr T Braithwaite (instructed by Messrs Cumberland Ellis) for the other Defendants (excepting the fourth and eighth defendants)
Hearing dates: 27 th,28 th,29 th,& 30 th, April 2009,
st,5th,6th,7th,8th,11th,12th,13th & 14th, May 2009,
th & 30th June 2009, and 1st & 2nd July 2009.
Mr Justice WarrenMr Justice Warren :
Introduction
The proceedings before me concern the unravelling of the business and, to some extent, the domestic property affairs of the members of a family. There are, broadly, two sets of proceedings. The first set relates to a number of partnerships carried on by different members of the family and to certain jointly-owned properties. The main partnership is known as Cashco. I will explain its genesis and nature later. There are also a number of smaller partnerships – which have been called the Minor Partnerships - in relation to some of which a number of discrete points are raised. The second set of proceedings relates to a company called VU Chem Ltd (“VU Chem”) which, as its name might suggest, is a company operating a number of retail pharmacies. These latter proceedings take the form of an unfair prejudice petition under section 459 Companies Act 1986 and section 994 Companies Act 2006. The objective of both sets of proceedings is to bring about a separation between the claimants/petitioners on the one hand and the rest of the family on the other hand.
The family
It will assist if I identify, at this early stage, the parties to the partnership action. Since many of the individuals share the same family name – Amin —I hope that I will be forgiven if I refer, at least to most of them, by their given names.
The claimants are Vatsal and his wife Anjuben (“Anju”). They are also the petitioners in the company action. Vatsal's father, who died on 22 February 1995, was called Babubhai Manibhai Amin and I shall refer to him as “the Father”. His widow, Pushpaben Babubhai Amin, whom I shall call “the Mother”, is still alive; she is the third defendant and is also a defendant in the company proceedings.
The first defendant is Vatsal's younger brother Udhyam (“Udi”) and the seventeenth defendant is his wife Bhavini. They are both defendants in the company proceedings. Udi is the most important figure on the defendants' side of the record.
The second defendant, (“Mr Desai”) is married to the thirteenth defendant Harshika; she is a sister of Vatsal and Udi and the eldest of the four daughters of the Father and the Mother.
The fourth defendant is a neice of the Father. She has played no active part in these proceedings.
There are four married couples who are not related to the Amins but who are or have been involved in one or more of the partnerships. They are the fifth and seventh defendants, the sixth and eighth defendants, the ninth and tenth defendants and the fourteenth (Swati) and sixteenth defendants. The fifteenth defendant is the brother of the sixteenth defendant and the eighteenth defendant is the son of the fifth and seventh defendants; each of them is interested in one of the partnerships.
The twelfth defendant, Nayana, is another sister of Vatsal and Udi; she is married to the eleventh defendant; they are concerned in three of the partnerships.
Some brief background
The Father, who was very much the head of the family during his lifetime, was born in India in 1927 and married the Mother in 1948. They later moved, first to Uganda and then to England in 1967. They had 6 children: four daughters and two sons, Vatsal and Udi who are the two main protagonists in the majority of the disputes.
In 1969 the Father and Mother acquired their first business, a single unit shop with a post office at 273 Cavendish Road, Balham; it had accommodation upstairs. In 1976 they acquired the freehold of that property, and by 1980 they had also acquired the freehold of 275 Cavendish Road. All members of the family, including the children, contributed to the running of the businesses.
The Father proceeded to acquire further such small properties, usually bringing in more distant family members to run the businesses to pay off the loans on the properties.
In 1978 the Father embarked on a new venture, Cashco. This was a cash and carry business originally established to supply the family's shops and other shops owned by his partners in Cashco. I use the name Cashco to describe the continuing business which has, over the years, been constituted with different partners from time to time. The first Cashco started in 1978. The partners included the Father and Vatsal as well as other persons. It was loss-making in the early days. It came to an end by agreement in 1981. The second Cashco partnership was formed in 1981 but it only lasted until 1983 when it was dissolved following a dispute over partnership shares.
The third Cashco partnership (with which I am concerned) involved, when established, only members of the immediate family. They were (and I show their shares in brackets) the Father (30%), the Mother (20%), Vatsal (20%) and Udi (20%), together with Mr Desai, Harshika's husband, (10%). Between 1983 and 1995 it is apparent that profit was not regularly paid out according to these partnership shares. Moreover, it seems that the partnership shares could be and were varied at the direction of the Father. Until at least the late 1980s the Father remained firmly in control of this major partnership. This situation was accepted by all concerned —there were no serious disputes between the partners while the Father was alive.
It seems that the partnership shares were varied as from 1 October 1983 so that the Father had 10%, each of Vatsal and Udi had 40% and Mr Desai had 10%. It is not altogether easy to see how this came about but it is common ground that I should treat Cashco as a partnership in those shares from 1983 until its dissolution some time in 1992. I say 1992 because it appears that as part of the restructuring which I refer to later, the Father gave up his 10% share and passed it on to Vatsal and Udi. In his witness statement, Udi says that the third Cashco partnership was only dissolved as a result of the Father's death, when the shares became Vatsal (45%), Udi (45%) and Mr Desai (10%). But that position was not maintained at the hearing. I believe it became common ground that the Father had ceased to be a partner before his death. I do not believe that anything actually turns on whether the Father ceased to be a partner before his death; it is accepted on all sides that the shares, following his death, were as I have set out.
The fourth Cashco partnership (whether running from the Father's death or some time earlier) ran until Vatsal dissolved the partnership on 28 February 2005, an event which led to these two sets of proceedings.
In April 1983, the property 166 Weir Road was purchased. This became the main office of Cashco and the place from which financial management of some other family enterprises took place.
VU Chem was established by the Father in 1982 with 499 shares held by each of his sons while he retained 2 shares for himself. Udi's position is that the Father was, at least at first, the driving force and business brain behind VU Chem albeit that Vatsal, then a newly qualified pharmacist, ran the day-to-day operations. Although the sons formally had the majority stake in the company, it was clear, according to Udi, that the Father retained effective control both through force of personality and through his 2 “golden shares” which would enable him to arbitrate in any dispute between his sons if ever one should arise.
In December 1991, the Father reached the age of 65. Udi says that the Father wished to prepare for retirement. Whether or not that is quite correct – my impression is that the Father is unlikely to have been a man to relinquish the reins – it is certainly the case that steps were taken to restructure various businesses and to alter the property holding of various properties registered in the joint names of the Father and one or more of the Mother, Vatsal and Udi. I shall turn to the detail of that (so far as relevant) in due course.
As I have just mentioned, Vatsal himself is a qualified pharmacist. There is some dispute about the level of involvement which the Father and Udi had in the affairs of VU Chem just as there is a level of dispute about the level of involvement which Vatsal had in any of the partnership business. Vatsal says that he and Anju had responsibility for the affairs of VU Chem; he says he was not simply a sleeping partner in the partnerships of which he was a partner, in particular Cashco, but took a close interest in them. Udi in contrast says that the Father during his lifetime took a close...
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