Samuel Metson v David Metson
| Jurisdiction | England & Wales |
| Judge | Mr Ashley Greenbank |
| Judgment Date | 26 July 2022 |
| Neutral Citation | [2022] EWHC 1988 (Ch) |
| Docket Number | Case No: CR-2021-000247 |
| Court | Chancery Division |
In the Matter of Baker & Metson Limited
And in the Matter of the Companies Act 2006
[2022] EWHC 1988 (Ch)
Ashley Greenbank (sitting as a deputy judge of the High Court)
Case No: CR-2021-000247
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
INSOLVENCY AND COMPANIES LIST (Ch)
Business and Property Courts of England and Wales
7 Rolls Buildings, London, EC4A 1NL
Hugh Jory QC (instructed by Goodman Derrick LLP) for the Petitioner
Martin Young, counsel (instructed by GSC Solicitors LLP) for the First and Second Respondents
Hearing dates: 28, 29, 30, and 31 March 2022, and 1, 4, 5, 6, 7, 8, 11 and 13 April 2022
APPROVED JUDGMENT
This judgment was handed down remotely by circulation to the parties' representatives by email and released to the National Archives. The date and time for hand-down is deemed to be 10.30am on Tuesday 26 July 2022
Mr Ashley Greenbank (sitting as a deputy judge of the High Court):
INTRODUCTION
This case concerns a Petition under s.994 of the Companies Act 2006 (“CA 2006”) in relation to the affairs of Baker & Metson Limited (“B&M” or the “Company”).
B&M is a family-owned company. It owns land around Little Dunmow in Essex, which is used for farming and the operation of a commercial shoot. From time to time, the Company also pursues various opportunities for the development of its land for housing or the installation of solar energy projects.
The petitioner is Mr Samuel Metson (“Sam”). Sam is a director of the Company and holds 6,100 ordinary shares of £1 each in the Company, representing 37% of the ordinary shares in issue, and 3,125 cumulative preference shares of £1 each in the Company, representing 40.3% of the preference shares in issue.
The first respondent is Mr David Metson (“David”). David is Sam's younger brother. David is also a director of the Company and also holds 6,100 ordinary shares of £1 each in the Company, representing 37% of the ordinary shares in issue, and 3,125 cumulative preference shares of £1 each in the Company, representing 40.3% of the preference shares in issue.
Full details of the shareholdings in the Company are set out at [28] below.
The second respondent is Mr Andrew Montlake. Mr Montlake was the Company's solicitor at the time of many of the events which are the subject of this Petition. He was also, at the outset of the matters that are referred to in the Petition, a consultant at Tolhurst Fisher, a firm of solicitors. As a consequence of the events to which I refer below, Mr Montlake became registered as a director of the Company, although the validity of his appointment is challenged by Sam as one of the matters referred to in his Petition.
The background to the Petition is an acrimonious dispute over the governance of the Company. I have set out the facts in more detail below (at [56] to [186]). In summary, Sam claims that David and Mr Montlake have pursued a course of action designed to seize control of the Company by, amongst other things, the invalid appointment of David's wife, Mrs Diana Metson (“Diana”), as a director of the Company, and the manipulation of events surrounding a general meeting of the Company to secure the appointment of Mr Montlake as a director of the Company and the confirmation of Diana's appointment as a director. Sam also claims that, without the authority of the board of the Company, David used that control to procure that the Company entered into an agreement with Grange Sporting Limited (“GSL”), a company controlled by David and Diana's son, Mr Richard Metson (“Richard”), which granted valuable rights to operate a commercial shoot on the Company's land.
Sam asserts that the affairs of the Company have been conducted in a manner which is unfairly prejudicial to his interests as a shareholder and the interests of other shareholders. In his Petition, Sam seeks a bespoke remedy in the form of an order from the court that a shareholders' meeting is convened at which resolutions are put to remove each of the directors currently registered at Companies House and, if the relevant director so wishes, to re-elect each of the directors subject to various directions as to how voting on those resolutions shall be conducted. Sam also seeks various other forms of relief including an order for rectification of the register of members of the Company.
THE WITNESSES AND THE EVIDENCE
The trial bundles contained copies of witness statements served on behalf of the petitioner, Sam, given by: Sam; his wife, Mrs Claire Metson (“Claire”); and Lady Angela Chadwyck-Healey (“Lady Angela”), Sam's half-sister. They were all cross-examined on their statements.
The bundles also contained witness statements served on behalf of the respondents, David and Mr Montlake, given by:
i) David;
ii) Mr Montlake;
iii) Diana;
iv) Richard;
v) Mr Daniel Cox, a game-keeper, who has been responsible for the commercial shoot that has been operated on the Company's land;
vi) Mr Robert Gazeley, a farming consultant and agronomist, and a partner in Ceres Rural LLP, who from time to time, supervised and administered the contract farming agreement between the Company and its farming contractor; and
vii) Mr Paul Fosh, a chartered surveyor and a senior director with Strutt & Parker, who had advised the Company, and David and Sam, on real estate matters including development opportunities, boundary disputes, land sales, compulsory purchases and landlord and tenant issues.
David, Diana, Richard and Mr Montlake were all cross-examined on their statements. The evidence of Mr Cox, Mr Gazeley and Mr Fosh was not challenged.
In his closing submissions, Mr Jory QC, for the petitioner, referred me to various cases providing guidance as to the caution required in evaluating the reliability of witness evidence and the importance of testing the veracity of such evidence by reference to the contemporaneous documents in the case. He referred me, in particular, to the judgment of Jacobs J in CJ and LK Perks v NatWest Markets Plc [2022] EWHC 726 (Comm) in which Jacobs J refers (at [154] to [155]) to the classic statement of Robert Goff LJ (as he then was) in Armagas Ltd v Mundogas SA (The Ocean Frost) [1985] 1 Lloyd's Rep 1 at page 57 and to the passage in Males LJ's judgment in Global Assets Ltd v Ikon Finance Ltd. [2019] EWCA Civ 1413 at [48]. He also referred me to the decision of Eason Raja QC, sitting as a Deputy High Court Judge, in Nejc Kodric v Bitstamp Holdings NV [2022] EWHC 210 (Ch) in which the deputy judge refers (at [6] to [9]) to the judgment of Lord Kerr in R. (on the application of Bancoult) (No. 3) v Secretary of State for Foreign and Commonwealth Affairs [2018] UKSC 3 at [100] to [101] and the observations of Leggatt J in Gestmin SGPS SA v Credit Suisse (UK) Ltd [2013] EWHC 3560 (Comm) at [15] to [20]. The approach as set out in those decisions is not controversial so I will not set out large tracts of those decisions here. I have taken into account the observations made in those cases in my assessment of the evidence in this case.
I will deal with the evidence in some detail later in this judgment, but I should make some general comments at this stage on the witnesses and their evidence.
Sam is a sensitive man. He found the process of giving evidence difficult. Mr Jory QC described Sam as having been bullied by his younger brother, David. I do not accept that description entirely. There were times at which Sam was easily led by David and also dominated by him, but the facts demonstrate that Sam was equally capable of being stubborn and refusing to accept an alternative view. For the most part, however, I have accepted his evidence, although there were times at which his evidence was vague and his recollections unclear.
Claire's evidence was largely limited to the event of the meeting on 3 February 2020 to which I refer below. Her evidence was supportive of her husband's evidence. For the most part, I have accepted her evidence, although, in common with Sam, her recollections were sometimes vague and unclear.
Lady Angela was clear in her recollections, and direct and to the point in her answers in cross-examination. She accepted that she had from time to time changed her view of the events as they were unfolding. However, she gave concise and clear reasons for her approach that were consistent with the surrounding documentary evidence. I have accepted her evidence.
David is a determined and, at times, stubborn man. He is also a man of detail and prone to giving lengthy answers packed with irrelevant detail in response to relatively straightforward questions. I am prepared to accept that, to an extent, that is simply his style. However, his answers in cross-examination were often evasive and argumentative, and his explanations of his motives for some of his actions were simply not credible. I refer, in particular, to his insistence that the timing of the payment of the preference share dividends (to which I refer at [120] to [132] below) was not motivated at least in part by a desire to deprive the holders of those shares of the right to vote at the forthcoming general meeting and that his decision to report Sam to the police for forgery and conspiracy (see [165] to [168]) was not intended to intimidate Sam into giving up his claims. I have therefore come to the conclusion that I must treat David's evidence with some caution except where his explanation is aligned with the objectively justifiable facts.
Diana was at pains to ensure that her evidence did not contradict her husband's and to that extent I must also treat her evidence with some caution. However, I disagree with Mr Jory QC's attempts to paint her evidence of that of a “dutiful wife to a bullying husband”. She...
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