The Court of Appeal has dismissed with costs an appeal in which a former director of Busy Five Enterprises, which owns Molapo Crossing shopping complex, wanted to be recognised as a three percent shareholder in the company.
AJit Singh Ahuja, a businessman who has several companies of his own, had filed an appeal against a High Court judgement in which it dismissed his claim for the entry of his name into the share register of Busy Five Enterprises. Busy Five Enterprises is owned by Luc Hubert Paul Vandecasteele, who is a property developer and an estate agent.
He had also appealed to be issued with the requisite share certificate, and for the consequent relief, including an accounting for any dividends declared. According to the evidence brought before the Court of Appeal, Ahuja and Busy Five Enterprises’ owner, Vandecasteele had entered into an agreement in September 2000 in which Ahuja was to buy a three percent stake in the shopping complex development by acquiring 90 shares in Busy Five Enterprises for P168,000.
Following the conclusion of the agreement, 90 shares of Busy Five were duly sold to Ahuja, whereupon he became the beneficial owner of the shares, with an entitlement to have his name entered on the company’s share register.
It was resolved that the final share certificates in Busy Five were to be issued and kept by the company secretaries, with certified copies to be given to the shareholders. However, it was said no such copies were ever delivered to Ahuja, but consequent to the acquisition of the shareholding, Ahuja was appointed as a director of Busy Five and served as such until he tendered a resignation letter in August 2001 and claimed a refund of the P168,000.
In October 2001, Busy Five allegedly cancelled Ahuja’s share certificate and his name
He also complained that he was not told of a major case pending against Busy Five, in which the company was being sued by Time Projects. The other query was that he had been misled into believing that all company expenses will be met from bank borrowings yet he was being asked to contribute towards legal and design costs which were benefiting other shareholders. He had stated that since no share certificates have been issued to date and no shareholder agreement signed, he was entitled to a refund of P168,000 plus interest accrued on this trust.
Following this, Ahuja is said to have later informed Vandecasteele that he no longer wished to sell his shares.
Ahuja also wrote several fruitless letters requesting his share certificate, while Vandecasteele wrote informing him that his requested refund was ready for collection. In dismissing the appeal, Court of Appeal Judge Ian Kirby said in accepting the resignation as a director of Busy Five, in agreeing to a refund, as per Ahuja’s request, as they did, and in having the necessary cheques prepared for collection, the directors of Busy Five accepted Ahuja’s repudiation of the sale of shares, or acknowledged its cancellation.
“The appeal must accordingly fail, and it is dismissed with costs,” he said.