Case details

Galantis (Respondent) v Alexiou and another (Appellants) (Bahamas)

Case ID: JCPC 2017/0077

Jurisdiction: The Court of Appeal, Commonwealth of Bahamas

Case summary

Issue(s)

The issues are:

  1. Whether the Court of Appeal misinterpreted section 272 of the Act as being applicable.
  2. Whether the Court of Appeal erred in disturbing Hepburn J’s conclusions on the law.
Facts

The Appellants were appointed as Directors of Ali-Cat Designs Ltd ("ACDL"). By a written agreement the Respondent sold all the shares in B.K. Holdings Ltd to ACDL for B$500,000. ACDL paid $300,000 of the purchase price in cash and the parties agreed that the balance would be paid by instalments. ACDL paid the Respondent a further B$36,506.34 towards the B$200,000 debt. However, ACDL subsequently refused to make further payments to the Respondent.

The Respondent obtained judgment for the outstanding balance of B$182,531.70 due and owing by ACDL, together with interest and costs. However, ACDL was removed from the Register of Companies as of 25 July 2008. The Respondent sought relief pursuant to section 280 of the Companies Act 1992 ("the Act") which entitles a complainant to apply to the court for any order against a company or director or officer of that company to restrain oppressive action.

The Supreme Court ruled that the Respondent was not entitled to relief under section 280 of the Act because the proceedings had been commenced after ACDL had been removed from the Register of Companies and ceased to exist. In such circumstances the Supreme Court found that the oppression was not ongoing, and the Appellants liability was expunged.

The Respondent appealed to the Court of Appeal. The Court of Appeal found that the removal of a company from the Register of Companies does not extinguish the liability of the company or its directors. The acts complained of by the Respondents were the result of the directors’ refusal to honour a debt, and to prevent payment of that debt by subsequently removing ACDL’s assets. Consequently, the trial judge was wrong to conclude that the Respondent was barred as a result of ACDL’s removal from the register from obtaining the relief sought.

Parties

Appellant(s)
  1. Antony Alexiou
  2. Alexander Alexiou
Respondent(s)

Zachary James Galantis

Appeal

Justices

Lord Reed, Lord Carnwath, Lord Hodge, Lady Black, Lord Lloyd-Jones

Hearing start date

18 Feb 2019

Hearing finish date

18 Feb 2019