Re Klimvest plc

Minority shareholders in plcs will welcome a judgment handed down this morning which has broadened their options. For the first time in this jurisdiction, the Court has ordered the winding up of a listed plc on the just and equitable ground under section 122(1)(g) of the Insolvency Act 1986 for loss of substratum. In a reserved judgment following a two-week trial in February 2022, in Re Klimvest plc [2022] EWHC 596 (Ch) the High Court clarified and modernised English law in line with more recent Australian authorities. HH Judge Cawson KC (sitting as a High Court Judge) held that the identification of a company’s purpose or substratum is a matter of equity between the company – even a listed plc – and its shareholders, rather than a formalistic exercise in construing the corporate constitution. The purpose is lost, potentially triggering winding-up by the Court, not only where carrying it out is “practically impossible” for the company, but also where it has been, or will be, abandoned. Judge Cawson KC applied the dictum of Jenkins J in Re Eastern Telegraph Co., Ltd [1947] 2 All ER 104 that “if a shareholder has invested his money in the shares of the company on the footing that it is going to carry out some particular object, he cannot be forced against his will by the votes of his fellow shareholders to continue to adventure his money on some quite different project or speculation”.

Judge Cawson KC also analysed whether, as a matter of law, equitable or ‘quasi-partnership’ constraints on the exercise of shareholders’ legal rights can ever arise in a public listed company, or whether as Jonathan Parker J had held in Re Astec (BSR) plc [1999] BCC 59, “the concept of ‘legitimate expectation’… can have no place in the context of public listed companies”. Without determining whether Re Astec had been correctly decided, Judge Cawson KC commented that “on appropriate facts, equitable considerations might arise as between shareholders in a public listed company”. While this would be “a rare event”, “there might, conceivably, be circumstances where the existence of those equitable considerations might found the basis for some limited form of relief under Section 996 of the Companies Act 2006”.

Daniel Lightman KC and Max Marenbon represented the successful petitioner, instructed by Tamar Halevy of Marriott Harrison LLP.

To read the judgment, please click here.

Related Barristers

As part of a broad Chancery-Commercial practice, Daniel Lightman KC engages with challenging and novel issues of law and civil procedure, in particular concerning shareholder disputes (having appeared in a number of landmark unfair prejudice petitions and derivative claims), company law (including in matrimonial proceedings), insolvency, civil fraud, breach of fiduciary duty and professional negligence.

Shortlisted for Company/Insolvency Silk of the Year in the Chambers & Partners UK Bar Awards in both 2026 and 2024 and shortlisted for Chancery Silk of the Year in the Legal 500 Bar Awards 2026, Daniel is recommended in Band 1 for Silks for Company by both Chambers UK, 2027 and the Legal 500, 2027 – and in Band 1 for Chancery Commercial by Chambers. Chambers UK, 2027 describes him as “A go-to silk for high value, complex disputes who leads the pack on shareholder disputes. He has great judgement and always furnishes reliable advice” and praises him for “constantly identifying innovative solutions to complex problems” and building “outstanding relationships with the wider legal team.”

Daniel has an extensive international practice, including current or recent shareholder litigation in the courts of Abu Dhabi, Bermuda, Cayman, Guernsey and Qatar, and a multi-shareholder arbitration in Hong Kong.

Daniel Lightman KC

Call: 1995
Silk: 2016

Max Marenbon is a commercial chancery barrister specialising in civil fraud, company and insolvency disputes. He is recognised by the Legal 500 directory as a ‘Leading Junior’ at the London Bar and a ‘Rising Star’ in the Middle East.

Max has appeared as sole counsel in significant cases, including a leading authority on the English courts’ jurisdiction to grant worldwide freezing orders against third parties. He has assisted with cases at all appellate levels. His Middle East practice is centred on the courts of the Dubai International Financial Centre (DIFC) and the Abu Dhabi Global Market (ADGM).

He is interested in how the law treats new ways of doing business, has experience of cryptocurrency-related litigation, and is growing a practice in artificial intelligence litigation. He has acted as sole advocate in AI-related cases in the UK and Middle East, including the leading ADGM authority on the use of AI-generated documents in litigation.

Appointed to the UK Attorney General’s Panel of Junior Counsel to the Crown in 2024, Max previously qualified as a solicitor at a leading City firm and served as judicial assistant to Lord Wilson at the UK Supreme Court.