Company Law–‐Opposing Oppression

AuthorPeter Ford
DOIhttp://doi.org/10.1111/j.1468-2230.1959.tb00542.x
Publication Date01 May 1959
840
THE
MODERN
LAW
REVIEW
VOL.
!E
passing of the property, and where he
does
exercise his right to
reject
it
is clear that the property revests in the seller. Thus,
in
Head
v.
Tattersall,“
where the buyer was able to recover the
price paid
on
rejecting the goods for breach of condition, Cleasby
B.
said:
‘‘.
.
.
the effect of the contract was to vest the property in
the buyer subject to a right of rescission in a particular event,
when
it
would revest in the seller.”
The truth
is
that
it
was unnecessary to consider the question
of the passing of the property in the instant case. Once it is
found that the buyer is entitled to reject the goods, his right to
the return of the price must follow, or else the right of rejection
is illusory. As Buller
J.
said in
Towers
v.
Barrett
la:
If
the
contract be rescinded
.
. .
the plaintiff is entitled to recover back
his
whole money; and then
an
action for money had and received
will
lie.” AUBREY
L.
DIAMOND.
CO-ANY
LAW-~PPOSINO
OPPRESSION
HABD
on
the heels
of
Scottish Co-operative Wholesale Society
v.
Meyer’
comes the decision of the Court of Appeal in
Re
H.
R.
Harmer, Ltd.l
This affirms the decision of Roxburgh
J.
granting
relief under section
210
of the Companies Act,
1948,
which provides
shareholders with a novel remedy against oppression. This is the
first reportedS case in England of
a
successful application under
this section, and
it
and
Meyer’s
case refute the view expressed
by the Northern Ireland Committee
on
Company Law Arnend-
mentY4 that the section “has been
so
framed that
it
has largely
missed the mark and has been found to be practically useless
5-
a
view to which most English practitioners would never have
subscribed.
The facts
in
Re Harmer
were very different from those in the
Meyer
case, but present in an exaggerated form a not. unusual
situation. The founder of the
firm,
having converted
it
into a
private company, gave his two
sons
the great majority of the
equity shares, but he and his wife retained the voting shares.
The father and the sons were appointed life directors but, in fact,
the father continued to run the company as if
it
were his own,
and to ride rough-shod over the decisions of the board. This
1’
(1871)
L.R.
7
Ex.
7.
at
p.
14.
18
(1786)
1
T.R.
133,
K.B.,
at
p.
136.
See, too,
Hardy
ct
Co.
V.
Hillerns
u?
Fowler
1
[1958] 3
W.L.R.
404; [1958] 3
All
E.R.
66,
H.L.(Sc.),
noted in
(1958) 21
2
[1959]
1
W.L.R.
62.
C.A.;
also
reported in
[1958]
3
All
E.R.
68.
3
It
is
understood that there
was
a
successful, unreported,
application
earlier
in
4
Cmd.
393;
noted
at
p.
304,
supra.
But the committee’s criticism
of
the wording
of
the section
[1923] 2
K.B.
490.
C.A.,
per
Bankes
L.J.
at
p.
496,
Atkin
L.J.
at
p.
499.
M.L.R.
653.
1958.
Ibid.,
para.
12.
has
great force.

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