Case No. CR-2019-LDS-000669

140.I did not understand the applicable law regarding s994 Companies Act 2006 to be controversial and, other than as set out in the skeleton arguments, it was the subject of few submissions.141.Under s.994 of the Companies Act 2006, a member of a company may petition the court for relief on the grounds: “(a) that the company’s affairs are being or have been conducted in a manner that is unfairly prejudicial to the interests of members generally or of some part of its members (including at least himself), or (b) that an actual or proposed act or omission of the company (including an act or omission on its behalf) is or would be so prejudicial.”142.As regards “the company’s affairs”, this may relate to the manner in which its subsidiary’s affairs are conducted or acts or omissions of the subsidiary (see Rackind v. Gross [2004] EWCA Civ 815; [2005] 1 WLR 3505 at [26]–[33] and Re Coroin Ltd (No. 2) [2012] EWHC 2343 (Ch), [2013] BCLC 583 at [628], [629]). The court looks at the commercial realities rather than adopting a technical or legalistic approach to what constitutes the affairs of the company. In this particular case, although Portbond and LWC are parent and subsidiary they were largely viewed as being, or being part of, one business: “Universal Recycling Company”. The directors were in reality common. This intertwining of affairs is shown not only by the history of family dealings over time but also by the various GT Reports. No point was taken by the Relevant Respondents that any relevant conduct of the affairs of, or act or omissions of, LWC that were relied upon by the Petitioner would not found a remedy under s994 for Lisa as a shareholder of Portbond (but not LWC), simply because of the separate legal personality of the two companies.143.The requirement under s994 of the 2006 Act is that what must be caused must both amount to relevant “prejudice” and the prejudice must be “unfair”.144.As regards prejudice, the petitioner must usually prove “harm in a commercial sense, not in a merely emotional sense”: Re Unisoft Group Ltd (No.3) [1994] BCLC 609. Prejudice “will most often be established by reference to conduct having a depressive effect (actual or threatened) on the value of the petitioner’s shareholding”: Re Sunrise Radio Ltd [2009] EWHC 2893 (Ch), [2010] 1 BCLC 367 at [4]. 145.But a petitioner may suffer commercial prejudice in other ways, for example by being excluded from management in breach of agreements or understandings between the shareholders. Further, there may be other cases where there is relevant prejudice even if the value of the petitioner’s shares is not affected (see the example of the removal of the auditor and the associated provision under s994(1A) of the Companies Act 2006 considered by HH Judge Purle QC in the Sunrise Radio case at [9] and [10] and said by him to reflect the common law position).146.As David Richards J (as he then was) helpfully summarised in the Re Coroin case at [630]-[631]:“