Lukas & Anor v Maltin & Ors

LORD JUSTICE KEENE: This is an application for permission to appeal from a decision of Mr Registrar Jaques on 19th October 2004 whereby he ordered that an allocation of shares, referred to in certain transfer notices, be deemed to have taken place on 27th January 2004. I can describe the background to that order briefly.

The first two applicants in this proposed appeal are the directors of the company Organic Power Holdings Limited ("Organic") which is the third applicant. The proposed respondents to this appeal were minority shareholders in Organic. The articles of association of that company included a pre-emption provision requiring a shareholder wishing to transfer his shares first to offer them to the first applicant by sending a transfer notice in writing: see Article 6.1.1. The proposed respondents did that on 29th December 2003, and on 27th January 2004 Mr Maltin, the first applicant, wrote stating that he was willing to purchase the shares at the stated price.

By Article 6.1.4 the directors of Organic were obliged to allocate the shares to the first applicant on 27th January 2004. That, however, did not happen, and until the allocation took place the proposed respondents were not entitled to payment for the transfer of their shares. Consequently the respondents presented a petition in the Companies Court claiming that the failure to allocate had unfairly prejudiced them and asking that the allocation be deemed to have taken place on 27th January 2004.

The matter came before Mr Registrar Jaques on 23rd July 2004 for directions. As a result of that hearing, he ordered that the present applicants file and serve evidence in answer by 4.30 p.m. on 4th October 2004, that the petitioners file and serve evidence in reply, if so advised, by 4.30 p.m. on 18th October 2004, and that the said petition be adjourned to 19th October 2004 and he specified a time and place. Costs were ordered to be in the petition.

That order of 23rd July 2004 records that the Registrar heard counsel for the petitioner and also heard Mr Maltin, that is the present first applicant, in person. There is no doubt that Mr Maltin was present when the Registrar made the order which he did. Not only does the order itself record that he was present, but the Registrar confirmed that during the 19th October hearing and this afternoon Mr Maltin has confirmed that.

What happened then is quite remarkable. The present applicants filed no evidence by 4th October and so the petitioner's solicitors wrote on 6th October 2004 pointing this out, and saying:

The response from Mr Maltin is dated 8th October. In it he stated as follows:

Mr Maltin subsequently wrote to the Companies Court on 14th October 2004 saying that he wanted the hearing date of 19th October to be vacated as he had not been notified of it and had arranged a business trip to Ireland for that day. That letter was duly drawn to the Registrar's attention at the hearing. The Registrar was satisfied that Mr Maltin had known about the 19th October date. In those circumstances, the Registrar made the order to which I have referred.

The applicants now seek permission to appeal against that order. They need a substantial extension of time to do so. The appellant's notice was not filed until 19th January 2005, well out of time, and even that was in the High Court. But putting that procedural error on one side, there was still, as I have indicated, a very substantial delay before the notice was filed with any court at all.

It is said in that notice that they did not receive the order of 19th October 2004 until 13th December 2004. However, there is in the bundle a letter from Mr Maltin, dated 25th October 2004, which makes it clear that he was aware that such an order had been made. The other side's solicitors had in effect sent him their minute of the order which had been made on 19th October by Mr Registrar Jaques. All that he had not received until December was the formal order itself. It does not seem to me that there are very strong arguments in favour of an extension of time, nonetheless I propose to consider the merits of the appeal.

The grounds of appeal against the order state:

This afternoon Mr Maltin concedes that he was there at the hearing of 23rd July when Mr Registrar Jaques adjourned the matter and gave directions, and Mr Maltin accepts that on that occasion the Registrar gave the date for the adjourned hearing and gave a date by which evidence was to be filed and served. But he emphasises that he was not subsequently notified and that he thought that he would get, along with the other applicants, formal notification of the hearing and of the order which was made.

I am satisfied, listening to Mr Maltin and taking on board the documentary evidence in this case, that the present applicants were all well aware of the hearing date of 19th October 2004 because Mr Maltin was informed of it at the hearing in July. His argument about not receiving the formal order of 23rd July until October is wholly without merit. It seems to me that that proposed appeal is yet another delaying tactic on his part. There is no prospect whatsoever of a successful appeal against the order of 19th October 2004. I extend time as requested, but this application for permission to appeal must be dismissed.