Examples Of Rule In Foss V Harbottle
BUSI0010 Individual Assignment Tang Jiheng Harry 3035022485 1. Introduction The relevant areas of law in this case are minority protection and unfair prejudice. It is necessary to consider whether the rule in Foss v Harbottle and S.168A against unfair prejudice are applicable to this case. The paper will analyze possible remedies and point out the appropriate action to be taken by the minority. 2. Scenario Ko, one of the three directors, was excluded from making investment decisions regarding acquiring a large quantities of retail outlets. Moreover, the acquisition plan renders her unable to receive the profit in return for her initial investment. At the end, Ho and Lo refuse Ko to buy out her investment from the company. In this regard, appropriate actions are needed for Ko to protect her interest from being abused. 3. Rule in Foss v Harbottle In Foss v Harbottle, individual shareholder cannot commence legal action against directors for breach of duties, which are owed to the company as a whole. The proper plaintiff is the company itself, rather than the individual shareholder. In Re Kong Thai Sawmill 1978, a person, who purchases the shares of a company limited by shares, has to accept “majority control principle”. Ko needs to comply with the majority shareholders’ decisions. The rule in Foss v Harbottle prevents Ko from bringing legal action against Ho and Lo. 4. Exceptions to the Rule in Foss v Harbottle However, there are some exceptions to rule in Foss v Harbottle,
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