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Houldsworth Village Management Co Ltd v Barton

[2020] EWCA Civ 980

Floyd, Asplin, Coulson LJJ

A company must keep a register of the names and addresses of its members. A member of the company may inspect the register on request. The company must comply with such a request unless directed not to do so by the High Court. Such a direction may be made if the request is not made for a “proper purpose” (ss.116, 117, Companies Act 2006).

Victoria Mill was a residential development comprising 180 flats. Those flats were let on long leases. The appellant was a party to those long leases and was responsible for providing the services to the building (structural repairs, common parts painting, etc) for which the leaseholders had to pay a service charge. In practice, it appointed managing agents to discharge those functions on its behalf. The shareholders and directors in the company were all leaseholders at the building.

Mr Barton made a request under s.116, 2006 Act, seeking the names and addresses of the members so that he could seek to persuade them to support the removal of the directors and the managing agents. The appellant contended that the removal of the agents was not a “proper purpose”: it did not relate to the management of the company but was concerned with how the company provided services under the long leases. It contended that s.116 was limited to requests by matters of corporate governance. The High Court rejected that argument.

The Court of Appeal dismissed an appeal. In the context of a lessee-owned company which existed to provide services under long leases, it was artificial to draw a distinction between the governance of the company and the discharge of functions under the long leases. Seeking the contact details of the other members in order to press for the replacement of the managing agents was a proper purpose for the purposes of s.116.

Comment

This has significant implications for lessee-owned/controlled vehicles (whether management companies, as in this case, or nominee purchasers in enfranchisement cases or right to manage companies). The divide between the “corporate” functions and the “leasehold” functions are not relevant for the purposes of s.116 (although they remain relevant for other matters, such as service charge recovery: Morshead Mansions Ltd v Di Marco [2008] EWCA Civ 1371).

Justin Bates led Alice Richardson (Trinity Chambers) for the appellant. The judgment is here.

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