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Can Deleware co with UK assets be held accountable

Co owns share of freehold in UK Property, can directors or the company be made to pay for damages

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A Delaware companyy that holds share of freehold in a property in UK,  abused it's majority shareholding (75%) in a UK Freehold Limited compnay. It carried out unauthorised structural alerations to the building.  It subsequently sold part  (50%) of the shareholdings and but retains 25%.

The Freehold is now being held liable for the remedial works.  Can the new shareholders go after the Deleware company since it still has an interest in the building?

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By johngroganjga
26th Jan 2022 13:23

If there ever was a question that was one for lawyers only, and one that any accountant should not touch with a bargepole, this is it.

You are asking your question in the wrong place entirely.

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paddle steamer
By DJKL
26th Jan 2022 14:18

You likely need to look at the warranties etc given within the legal agreement when the shares were sold, probably a nice earner for the various solicitors. (extra skiing trips for them for the next few years)

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By ireallyshouldknowthisbut
26th Jan 2022 14:30

not a lawyer, but the question should never be "can they be held liable?" in the strict legal sense.

The question should always be "it is economic to pursue this matter?"

You can always find an lawyer to argue your case, but that does not mean it is worthwhile doing so.

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By paul.benny
26th Jan 2022 14:39

Ninjin wrote:
A Delaware company ... carried out unauthorised structural alterations to the building

What exactly do you mean by unauthorised alterations? Someone (a director of the UK company?) will have contracted with a builder (presumably not the Delaware company) to carry out the works.

Absent any formal agreement to the contrary, the majority shareholder controls the board and so can broadly do as they wish. If minority shareholder doesn't like it, they have few remedies.

The answers are unimportant here. You need to understand the facts and timelines a little better.

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paddle steamer
By DJKL
26th Jan 2022 15:38

Controlled, past tense, not controls since the share sale. Notwithstanding may be academic as I am not seeing much of an avenue for Company itself to litigate but the purchasers of the shares may have an action.

The company having a pop at a former director/directors, or even a current director/directors seems difficult to me, duty of care, negligence ,both a tough ask

I would chase into the share sale agreement and the diligence re same, if solicitors involved and the major business asset was a property then planning, warrants, completions and listed building consents likely ought to have been reviewed as part of the diligence, so what did the solicitors do or not do, remember solicitors carry PII.

If sellers gave warranties that might give another avenue and warranties given by them may get them on the hook.

If the share sale was DIY with no professional legal input then imho the purchasers probably deserve what they have got.

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By paul.benny
26th Jan 2022 16:31

+1

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By Ninjin
26th Jan 2022 16:54

It seems, the contractor was paid cash. No formal contract

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By Ninjin
26th Jan 2022 16:56

Unauthorised alterations - Without a signed license for alteration from the Freehold

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By paul.benny
27th Jan 2022 07:06

You're dripping in incomplete facts and using jargon that doesn't make sense.

(Why would the majority shareholder of a property-owing company need a license to do anything to the company's property? Might do - if shareholder was also occupier in their own right).

If you want meaningful responses, you need to much clearer here about the full facts including the sums involved. Until then, I'm out.

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