What can a shareholder do if a company is being run unfairly against them in Trinidad and Tobago?

Who can apply: the "complainant"

The main remedies in the Companies Act (Chapter 81:01) are open to a "complainant" (s 239):

• a shareholder or debenture holder, or a former one, of the company or any of its affiliates;
• a director or officer, or a former one, of the company or any of its affiliates;
• the Registrar; or
• anyone else the Court, in its discretion, considers "a proper person" to apply.

The oppression remedy

A complainant may apply to the Court, which may make an order if satisfied that the company's acts or omissions, the way its business or affairs are or have been conducted, or the way the directors' powers are or have been exercised, is "oppressive or unfairly prejudicial to, or … unfairly disregards the interests of, any shareholder or debenture holder, creditor, director or officer" (s 242(2)).

The Act follows Canadian legislation, and the Supreme Court of Canada, whose decisions are persuasive, asks two questions: does the evidence support the reasonable expectation the claimant asserts, and was that expectation breached by conduct that is oppressive, unfairly prejudicial or unfairly disregards a relevant interest (BCE Inc v 1976 Debentureholders 2008 SCC 69 [68]). The conduct need not still be going on when the claim is filed, but there must then be an existing state of oppression or unfairness that the Court can remedy (Galantis v Alexiou [2019] UKPC 15 [16], [22], on the similar Bahamas provision).

The Court may make "any interim or final order it thinks fit" (s 242(3)), including orders:

• restraining the conduct;
• appointing a receiver, or new or additional directors;
• amending the articles or by-laws;
• requiring the company or anyone else to buy a holder's shares or debentures, or repay what the holder paid for them;
• setting aside a transaction, or compensating an aggrieved person;
• winding up the company.

The company itself may not make such a payment if there are reasonable grounds for believing that it is, or would after the payment be, unable to pay its liabilities as they become due, or that the realisable value of its assets would be less than its liabilities (s 242(6)).

Suing for the company: the derivative action

A complainant may apply for leave to bring an action in the name and on behalf of the company (or a subsidiary), or to intervene in an action to which it is a party (s 240(1)). The Court must be satisfied that (s 240(2)):

1. the complainant gave the directors reasonable notice that they would apply if the directors did not themselves act;
2. the complainant is acting in good faith; and
3. the action appears to be in the company's interests.

In a derivative action the Court may order the company to pay the complainant's reasonable legal fees (s 241(d)). It may also order interim costs, though the complainant may have to account for them at the end (s 244). A claim is not stopped only because the shareholders have approved, or might approve, the breach (s 243(1)).

Other remedies

• Compliance or restraining order. If the company or its directors, officers or others breach the Act, the articles, the by-laws or a unanimous shareholder agreement, a complainant or creditor may ask the Court to order compliance or restrain the breach (s 249).
• Inspecting records. Directors and shareholders, and their attorneys, may examine the company's articles, by-laws, shareholders' minutes and resolutions and registers during usual business hours, and take extracts free of charge (ss 177, 190(1)).
• Dissent and fair value. A shareholder may dissent from some resolutions and be paid the fair value of their shares, unless there are reasonable grounds for believing that the company is, or would after paying be, unable to pay its liabilities as they become due, or that its assets would fall below its liabilities (s 236). The resolutions that give this right include adding, changing or removing restrictions in the articles on the issue or transfer of shares or on the business, an amalgamation other than a short-form one, and selling, leasing or exchanging all or substantially all of the company's property (s 227(1)). The shareholder normally sends a written dissent at or before the meeting and a written demand for payment within 20 days after receiving notice of the resolution or learning of it, and must send in the share certificates within 30 days after the demand or lose the right to claim (ss 227(6), 228(1)–(3)).
• Winding up. The Court may wind up a company where it considers it "just and equitable" (s 355(e)). A complainant may ask for this in the alternative to an oppression order (s 242(7)). A shareholder petitioning as a contributory must have been allotted the shares, inherited them on a holder's death, or held them in their own name for at least 6 months in the 18 months before the winding up begins (s 357(2)(a)).