Limitation periods do apply to unfair prejudice petitions

Judgment has been handed down by the Court of Appeal in THG plc and others v. Zedra Trust Company (Jersey) Limited [2024] EWCA Civ 158 confirming that, contrary to "over 40 years' received wisdom" limitation periods do apply to unfair prejudice petitions.

A Commercial Litigation team from Gowling WLG, led by Catherine Naylor and Tom Cox, and including associate Elizabeth Duggleby and legal apprentice Lucy Jackaman, acted on behalf of the successful appellants, THG plc and others. They instructed Lance Ashworth KC and Dan McCourt Fritz KC, both of Serle Court.

Following two days in the Court of Appeal in February 2024, the unanimous judgment held that the Court of Appeal was not bound by the ratio of the earlier Court of Appeal decision in Bailey v Cherry Hill Skip Hire Ltd [2022] EWCA Civ 531 and that limitation periods do apply to unfair prejudice petitions under section 994 of the Companies Act 2006. That is so despite the fact that it is "undoubtedly received wisdom that no limitation period applies" to unfair prejudice petitions – and the detailed judgment of Lewison LJ cites commentary from no less than five textbooks and two Law Commission reports assuming the contrary.

The limitation period is 12 years under section 8 of the Limitation Act 1980, save where the claim is for compensation or monetary relief, in which case the limitation period is six years under section 9 of the Limitation Act 1980. 

For further details of the case, see the full judgment online. To discuss any of the points this may raise, please contact either Catherine Naylor or Tom Cox.