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12 January 2024 / Lois Horne
Issue: 8054 / Categories: Features , Commercial
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The shareholder principle: ripe for change?

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In the wake of the rise in shareholder activism & the recent decision in G4S, Lois Horne discusses disclosure & the shareholder principle
  • Considers the recent case of Various claimants v G4S, in which the High Court examines the rule that a company cannot assert privilege against its shareholders, save where the advice concerns contemplated proceedings between the company and its shareholders.
  • The judge considered that this disclosure right is based on a ‘shaky’ legal foundation and should not be extended. The rule is therefore limited to direct registered shareholders.

In the recent case of Various claimants v G4S [2023] EWHC 2863 (Ch), Mr Justice Michael Green considered the principle that a company cannot assert privilege against its shareholders, except where the documents came into existence in contemplation of proceedings between the company and its shareholders (the shareholder principle). Given the recent rise of shareholder activism, and of shareholder claims more generally, the shareholder principle is of considerable practical importance, particularly as shareholders generally only have very limited rights to obtain company documents outside the context of litigation. However,

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MOVERS & SHAKERS

Jurit LLP—Caroline Williams

Jurit LLP—Caroline Williams

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Freeths—Michelle Kirkland Elias

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Flint Bishop—Deborah Niven

Flint Bishop—Deborah Niven

Firm appoints head of intellectual property to drive northern growth

NEWS
Talk of a reserved ‘Welsh seat’ on the Supreme Court is misplaced. In NLJ this week, Professor Graham Zellick KC explains that the Constitutional Reform Act treats ‘England and Wales’ as one jurisdiction, with no statutory Welsh slot
The government’s plan to curb jury trials has sparked ‘jury furore’. Writing in NLJ this week, David Locke, partner at Hill Dickinson, says the rationale is ‘grossly inadequate’
A year after the $1.5bn Bybit heist, crypto fraud is booming—but so is recovery. Writing in NLJ this week, Neil Holloway, founder and CEO of M2 Recovery, warns that scams hit at least $14bn in 2025, fuelled by ‘pig butchering’ cons and AI deepfakes
After Woodcock confirmed no general duty to warn, debate turns to the criminal law. Writing in NLJ this week, Charles Davey of The Barrister Group urges revival of misprision or a modern equivalent
Family courts are tightening control of expert evidence. Writing in NLJ this week, Dr Chris Pamplin says there is ‘no automatic right’ to call experts; attendance must be ‘necessary in the interests of justice’ under FPR Pt 25
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